SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934

Filed by the Registrantþ


Filed by a Party other than the Registranto
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [  ]
Check the appropriate box:
[  ]Preliminary Proxy Statement[  ]Confidential, for Use of Commission
[X]Definitive Proxy Statement     Only (as permitted by Rule 14a-6(e)(2))
[  ]Definitive Additional Materials   
[  ]Soliciting Material Pursuant to par 240.14a-11(c) or par. 240.14a-12
      
Check the appropriate box:MidSouth Bancorp, Inc.
(Name of Registrant as Specified In Its Charter)
      
oBoard of Directors of MidSouth Bancorp, Inc.
Preliminary(Name of Person(s) Filing Proxy Statement,oConfidential, for Use of Commission if other than the Registrant)
þ
Definitive Proxy StatementOnly (as permitted by Rule 14a-6(e)(2))
o
Definitive Additional Materials      
oSoliciting Material Pursuant to par 240.14a-11(c) or par. 240.14a-12Payment of Filing Fee (Check the appropriate box):

MidSouth Bancorp, Inc.

(Name of Registrant as Specified In Its Charter)

Board of Directors of MidSouth Bancorp, Inc.

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

      
o[  ]$125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or item 22(a)(2) of Schedule 14A.
o[  ]$500 per each party to the controversy pursuant to Exchange Act Rule 14a-6(i)(3).
o[  ]Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
      
 1)1)Title of each class of securities to which transaction applies:
      
 2)2)Aggregate number of securities to which transaction applies:
      
 3)3)Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee is calculated and state how it was determined):
      
 4)4)Proposed maximum aggregate value of transaction:
      
 55))Total Fee Paid:  Total Fee Paid:
      
 
o[  ]Fee paid previously with preliminary materials.
      
o[  ]Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously.  Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
      
 11))Amount Previously Paid:  Amount Previously Paid:
      
 2)2)Form, Schedule or Registration Statement No.:
      
 3)3)Filing Party:
      
 44))Date Filed:  Date Filed:


TABLE OF CONTENTS

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
PROXY STATEMENT
ELECTION OF DIRECTORS
SECURITY OWNERSHIP OF MANAGEMENT
AND CERTAIN BENEFICIAL OWNERS
EXECUTIVE COMPENSATION AND CERTAIN TRANSACTIONS
COMPENSATION COMMITTEE REPORT
AUDIT COMMITTEE REPORT
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS





MIDSOUTH BANCORP, INC.


102 Versailles Boulevard
Versailles Centre
Lafayette, Louisiana 70501

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS



Lafayette, Louisiana
April 2523,2005

     The2008


We will hold our annual shareholders meeting of shareholders of MidSouth Bancorp, Inc. (“MidSouth”) will be held on Thursday,Wednesday, May 26, 2005,28, 2008, at 4:2:00 p.m., local time, at our corporate offices, 102 Versailles Blvd., Lafayette, Louisiana 70501, where we will vote upon:
1.           The MCM Eleganté, at 2355 I-10 South, Beaumont, Texas, 77705 to elect directors and to consider suchelection of directors.

2.           Such other matters as may properly come before the meeting or any adjournments thereof.

Only holdersadjournments.


If you are listed on our books as the holder of record of MidSouthour common stock at the close of business on March 2831,2005, 2008, you are entitled to notice of and to vote at the meeting.


Your vote is important regardless of the number of shares you own.  WHETHER OR NOT YOU PLAN TO ATTENDCOME TO THE MEETING,PLEASE MARK, DATE AND SIGN THE ENCLOSED PROXY AND RETURN IT PROMPTLY IN THE ACCOMPANYING ENVELOPE.  YOUR PROXY MAY BE REVOKED BY APPROPRIATE NOTICE TO MIDSOUTH’SOUR SECRETARY AT ANY TIME PRIOR TOBEFORE IT IS VOTED.


BY ORDER OF THE VOTING THEREOF.BOARD
BY ORDER OF THE BOARD
OF DIRECTORS
Karen L. Hail
Secretary



Karen L. Hail
   Secretary



-1-

MIDSOUTH BANCORP, INC.


102 Versailles Boulevard
Versailles Centre
Lafayette, Louisiana 70501

PROXY STATEMENT


This Proxy Statement is furnished holders of common stock of MidSouth Bancorp, Inc. (“MidSouth”) in connection with the solicitationbeing sent to our stockholders to solicit on behalf of itsour Board of Directors (the “Board”) of proxies for use at MidSouth’sour annual shareholders meeting (the “Meeting”) to be held on Thursday,Wednesday, May 26, 2005,28, 2008, at the time and place shown in the accompanying notice and at any adjournments thereof.  This Proxy Statement is first being mailed to shareholders on or about April 2523, 2005.

2008.


Only holders of record of MidSouthour common stock (“Common Stock”("stock") on our books at the close of business on March 28, 2005,31, 2008, are entitled to notice of and to vote at the Meeting.  On that date MidSouthwe had outstanding 4,487,1356,762,531 shares of Common Stock.

stock, each of which is entitled to one vote.


The presence, in person or by proxy, of holders of a majority of the outstanding shares of Commonour Stock entitledis needed to vote is necessary to constitutemake up a quorum. Ifquorum; if a quorum is present, directors are elected by plurality vote; withplurality.  With respect to any other proposal, that may properly come before the Meeting,however, if the Board has recommended it by the affirmative vote of thea majority of theour Continuing Directors, as defined in MidSouth’sour Articles of Incorporation, (“Articles”), then, generally, the affirmative vote of a majority of the votes cast is required to approve it, butand if it is not so recommended, then the affirmative vote of 80% of the Total Voting Power, as defined in the Articles, is required to approve it.  MidSouth’s By-laws provide that theThe Continuing Directors will appoint the Judge(s) of Election, and that all questions as to thevoter qualification, of voters,proxy validity of proxies and the acceptanceaccepting or rejection ofrejecting votes will be decided by the Judge(s).


Abstentions or broker non-votes will not have noany effect on the election of directors.  With respect toOn any other proposal, abstentions and broker non-votes will be counted as votes not cast and will have no effect on any proposal requiringthat needs a majority of votes cast to approve it and will have the effect of a vote against any proposal requiring an affirmativethat needs the vote of a percentage of the Total Voting Power.


All proxies received in the enclosed form enclosed will be voted as specifiedyou specify and, in the absence of instructionsunless you specify to the contrary, will be voted for the election of the persons named herein.  MidSouth doesWe do not know of any mattersanything else to be presented at the Meeting other than those described herein; however,the election, but if any other matters properlyanything else does come before the Meeting or any adjournments thereof, it is the intention ofup the persons named in the enclosed proxy towill vote the shares representedcovered by them in accordance with their best judgment.

     The enclosedthe proxy as determined by the Board of Directors.


A proxy may be revoked by the shareholderyou at any time prior tobefore its exercise by filing with MidSouth’sour Secretary a written revocation or a duly executed proxy bearingwith a later date. A shareholder who votesIf you vote in person in a manner inconsistent with a proxy previously filed on his or her behalfby you, you will be deemed to have revoked the proxy as to the matters you voted uponon in person.

- 2 -


The cost of soliciting proxies in the enclosed form will be borne by MidSouth.us.  In addition to the use of the mail, proxies may be solicited by personal interview, telephone, telegraph, facsimile, internet and e-mail.  Banks, brokerage houses and other nominees or fiduciaries may be requestedasked to forward the soliciting materialthese materials to their principals and to obtain authorization for the execution ofget authority to execute proxies, and MidSouthwe will, upon request, reimburse them for their expenses in so acting.

-2-


ELECTION OF DIRECTORS

     The


Our Articles provide for three classes of directors, with one class to be elected at each annual meeting for a three-year term.  At the Meeting, Class III Directors will be elected to serve until the third succeeding2011 annual meeting and until their successors have been duly elected and qualified.

meeting.


Unless you withhold authority, is withheld, the persons named in the enclosed proxy will vote the shares representedcovered by the proxies received by them for the election of the threefour Class III director nominees named below.  In the unanticipated event thatIf for some reason  we do not anticipate one or more nominees cannot be a candidate at the Meeting, the shares represented will be voted in favor of such other nomineespersons as may be designated by the Board.Board chooses.  Directors will be elected by plurality vote.


Other than the Board, only shareholders entitled to vote for the election of directors who have complied with the procedures of Article IV(H)IV (H) of MidSouth’sour Articles may nominate a person for election.  To do so, the shareholderyou must have given us written notice to MidSouth by December 6, 2004,27, 2007, of the following:

(1) as to each person whom he or she proposesyou propose to nominate, nominate:

(a) his or her name, age, business address, residentialresidence address, principal occupation or employment, and

(b) the class and number of shares of MidSouth’sour stock of which he or shethe person is the beneficial owner and (b)

(c) any other information relating to suchthe person that would be required to be disclosed in solicitations of proxies for the election of directors by Regulation 14A under the Securities Exchange Act of 1934; and

(2) as to the shareholder giving the notice, you:

(a) his or heryour name and address and

(b) the class and number of shares of stock of MidSouthour Stock of which he or she isyou are the beneficial owner and (b)

(c) a description of any agreements, arrangements or relationships between the shareholderyou and each person he or she proposesyou want to nominate.

Two inspectors, not affiliated with MidSouth,us, appointed by MidSouth’sour Secretary, will determine whether the notice provisions were met; if they determine that the shareholder hasyou have not complied with Article IV(H), the defectiveyour nomination will be disregarded.

- 3 -


The following table sets forth certaingives information as of March 21, 2005, with respect to31, 2008, about each director nominee and each director whose term as a director will continue after the Meeting.other director.  Unless otherwise indicated, each person has been engaged inhad the principal occupation shown for at least the past five years. The Board recommends a vote FOR each of the three nominees named below.

Directortherein.


-3-

Directors Nominees for terms expire in 2011 (Class III Directors)
Name
 
Age
 
Principal Occupation
Year First Became Director
James R. Davis, Jr.  55 President, Davis/Wade Financial Services, L.L.C.; Chairman of our Audit Committee and our Lead Director1991
Karen L. Hail  54 Our Senior Executive Vice President and Chief Operating Officer of our subsidiary MidSouth Bank, N.A.1988
Milton B. Kidd, III, O.D.  59 Optometrist, Kidd Vision Centers, Kidd and Associates, L.L.C.1996
R. Glenn Pumpelly  49 President/ C.E.O. Pumpelly Oil Company, L.L.C.2007
       


        Directors whose terms to expire in 20082009 (Class IIII Directors)
           
        Year First
Name Age Principal Occupation Became Director
James R. Davis, Jr.  52  Owner/President, Davis-Wade Financial Services, L.L.C.; Chairman, MidSouth Audit Committee (Lead Director)  1991 
           
Karen L. Hail  51  Senior Executive Vice President/Chief Operations Officer, MidSouth Bancorp and MidSouth Bank, N.A. (the “Bank”), MidSouth’s wholly-owned subsidiary  1988 
           
Milton B. Kidd, III, O.D.  56  Optometrist, Kidd & Associates, L.L.C.  1996 

Directors

Name
 
Age
 
Principal Occupation
Year First Became Director
C.R. Cloutier  61 Our President and C.E.O., and President of our subsidiary, MidSouth Bank, N.A.1984
J.B. Hargroder, M.D.  77 Physician, retired; Vice Chairman of our Board1984
Timothy J. Lemoine  57 Consultant and Investor2007
William M. Simmons  74 Investor1984
       


Director whose terms to expire in 2006 (Class I Directors)
           
        Year First
Name Age Principal Occupation Became Director
C. R. Cloutier  57  President and C.E.O., MidSouth and the Bank  1984 
           
J. B. Hargroder, M.D.  74  Physician, retired; Vice Chairman, MidSouth Board  1984 
           
Ron D. Reed  51  President and C.E.O., Lamar Bank, MidSouth’s wholly-owned subsidiary  2004 
           
William M. Simmons  71  Private Investments  1984 

Directors whose terms expire in 20072010 (Class II Directors)

Name
 
Age
 
Principal Occupation
Year First Became Director
Will Charbonnet, Sr.  60 Our Chairman of the Board; Treasurer and Managing Director of Crossroads Catholic Bookstore (non-profit corporation); Controller of Philadelphia Fresh Foods, L.L.C.1984
Clayton Paul Hilliard  82 President of Badger Oil Corporation, Badger Oil & Gas Ltd., Convexx Oil and Gas, Inc., and Warlord Oil Corporation; Manager, Uniqard, L.L.C.1984
Joseph V. Tortorice, Jr.  58 CEO, Deli Management, Inc.2004
              
 Year First      
Name Age Principal Occupation Became Director
Will G. Charbonnet, Sr.  57  Chairman of the Board, MidSouth and the Bank; Treasurer, Lafayette Catholic Book Store; Computer/Business Consultant (1986-Present); Director Lafayette Catholic Social Services (non-profit charity)  1984 
          
Clayton Paul Hilliard  79  President/Owner: Badger Oil Corporation, Badger Oil & Gas Ltd., Convexx Oil and Gas, Inc., Warlord Oil Corporation  1985 

- 4 -

           
        Year First
Name Age Principal Occupation Became Director
Stephen C. May  56  Publisher and principal shareholder MayDay Communications, L.L.C.-The Independent Weekly; Investor and business consultant (1999-Present)  2000 
           
Joseph V. Tortorice, Jr.  56  President, Deli Management, Inc.; Chairman of the Board, Lamar Bank, MidSouth’s wholly-owned subsidiary  2004 

-4-



Corporate Governance


Shareholder, Board of Director and Committee Meetings.During 2004,2007 the Board held fifteen meetings. Each incumbenthad twelve meetings, and each director attended at least 75% of the aggregatetotal number of meetings held during 2004 of the Board and committees of which he or she was a member.  While the Company encourageswe encourage all Board members of the Board to attendcome to annual shareholder meetings, there is no formal policy as to their attendance.  It is a rare occasion, however, when all members of the Board are not present for the shareholder meeting. At the annual meeting of May 18, 2004, all directors were in attendance.

there.


Board of Director Independence.Each year, theour Corporate Governance and Nominating Committee reviews the relationships that each director has with the Companyus and with other parties.  Only those directors who do not have any relationships that precludekeep them from being independent within the meaning of applicable American Stock Exchange (“AMEX”) rules and who the Corporate Governance and Nominating Committee affirmatively determinesfinds have no relationships that would interfere with the exercise of independent judgment in carrying out thetheir responsibilities of a director are considered to be “independent directors.” The Corporate Governance and Nominating Committee has reviewedreviews a number of factors to evaluate the independence, of each board member. These factors includeincluding the directors’ relationships with the Companyus and itsour competitors, suppliers and customers; their relationships with management and other directors; the relationships their current and former employers have with the Company;us; and the relationships between the Companyus and other companies of which the membersthey are directors or executive officers. After evaluating these factors, the Board has determined that Messrs. Charbonnet, Davis, Hargroder, Hilliard, Kidd, May,Lemoine, Pumpelly, Simmons Tortorice and WeirTortorice are independent directors within the meaning of applicable AMEX rules.


Shareholder Communications.Shareholders may communicate directly with members of the Board or the individual chairmanchairmen of standing committees by writing directly to those individualsthem at the following address: P. O. Box 3745, Lafayette, LA  70502.  The Company’s policy is toWe will forward, and not to intentionally screen, any mail received at the Company’s corporate officewe receive that is directed to an individual, unless the Company believeswe believe the communication may pose a security risk.


Code of Ethics.The Board has adopted a Code of Ethics for our directors, officers and employees of the corporation. It is intended to promote honest and ethical conduct, full and accurate reporting, and compliance with laws as well as other matters.  A copy of the Code

- 5 -

of Ethics is posted on the Corporate Relations page of the Company’sour website atwww.midsouthbank.com.

www.midsouthbank.com.


The Board has an Audit Committee, an Executive Committee, a Personnel Committee, and a Corporate Governance and Nominating Committee.


The members of the Audit Committee members are Messrs. Davis, Charbonnet, Hilliard, and Kidd. The Committee, whichKidd and held nine meetings in 2004,2007.  It is responsible for carrying out the Audit Committee Charter which is attached to the Proxy Statement as Exhibit B.

Charter.  The members of the Executive Committee members members are Messrs. Charbonnet, Cloutier, Hargroder, Pumpelly, and Hargroder. The Committee’sTortorice and met eleven times in 2007.  Its duties include shareholder relations, Bank examination and Securities and Exchange Commission (“SEC”) reporting.  The Committee met thirteen times in 2004.

     The members of the Personnel Committee members are Messrs. Charbonnet, Davis, Hargroder, Hilliard, Kidd, May and Simmons. The Committee, whichTortorice and met foursix times in 2004,2007.  It is responsible for evaluating the performance and settingsetting/approving the compensation of MidSouth’sour executive officers and administering MidSouth’s Stockour 2007 Omnibus Incentive Compensation Plan.

  The members of the Corporate Governance and Nominating Committee members are Messrs. Charbonnet, Hargroder, Hilliard and Hilliard. The Committee assistsSimmons and met three times in 2007. It helps the Board in makingto make determinations of director independence, assessingassess overall and individual Board performance and recommendingrecommend director candidates, including those recommendations submitted by shareholders. The Committee met once in 2004.

     Although



-5-
It is the Corporate Governance and Nominating Committee does not have a formal charter, it does operate under Corporate Governance Principles that are attached to this proxy statement, and it is the Committee’s policy that candidates for director possesshave the highest personal and professional integrity, have demonstrated exceptional ability and judgment, and have skills and expertise appropriate for the Company and serving the long-term interest of the Company’sour shareholders.  The Committee’s process for identifying and evaluating nominees is as follows:  (1) in the case of incumbent directors whose terms of office are set to expire, the Committee reviews such directors’their overall service to the Company during their terms, including the number of meetings attended, level of participation, quality of performance, and any related party transactions with the Companyus during the applicable time period; and (2) in the case of new director candidates, the Committee first conducts any appropriate and necessary inquiries into thetheir backgrounds and qualifications of possible candidatesare made after considering the function and needs of the Board.  The Committee meets to discuss and consider such candidates’ qualification,qualifications, including whether the nominee is independent within the meaning of AMEX rules, and then selects a candidate for recommendation to the Board by majority vote.Board. In seeking potential nominees, the Corporate Governance and Nominating Committee uses its and management’s network of contacts to compile a list of potential candidates, but may also engage, if it deems appropriate, a professional search firm. Tofirm, although to date the Committeeit has not paid a fee to any third party to assist in the process of identifying or evaluating director candidates.

- 6 -

done so.


The Corporate Governance and Nominating Committee will consider director candidates recommended by shareholders provided the shareholderswho follow the procedures set forthout in Article IV(H)IV (H) of the Company’s Articles. The committeeour Articles described elsewhere.  It does not intend to alter the manner in which it evaluates candidates, including the criteria set forth above, based on whether the candidate was recommended by a shareholder or otherwise.


Eligible shareholders who desirewant to present a proposal qualified for inclusion in theour proxy materials relating tofor the 20062009 annual meeting must forward such proposal to theour Secretary of MidSouth at the address listed on the first page of this Proxy Statement in time to arrive at MidSouth before December 13, 2005.

     The Board has adopted a Statement of Corporate Governance Principles, a copy of which is attached as Exhibit A to this proxy statement.

     A majority of the directors of MidSouth are also directors of the Bank. Directors are entitled to fees of $100 per month for service on the MidSouth Board and $200 per month for service on the Bank Board. The Chairman of the Board receives an additional $750 per month, the Vice Chairman receives an additional $350 per month and the Chairman of the Audit Committee receives an additional $670 per month. Each director also receives $350 for each regular meeting, and $125 for each special meeting of the Board of the Bank, and $150 for the first hour, and $75 per hour for each additional hour, of each committee meeting. Directors receive meeting fees only for meetings they attend.

     In 1997 directors who were not employees were granted options to purchase up to 15,081 shares of Common Stock at $4.85 per share, the fair market value on the date of grant, exercisable in annual 20% increments beginning one year from the date of grant. Stephen C. May, a more recent addition to the Board, was granted options in 2002 to purchase up to 8,938 shares of Common Stock at $9.46 per share, the fair market value on the date of grant, exerciseable in annual 20% increments beginning one year from the date of grant.

25, 2008.


The Securities and Exchange Act of 1934 and applicable SEC regulations require MidSouth’sour directors, executive officers and ten percent shareholders to file with the SEC initial reports of ownership and reports of changes in ownership of our equity securities, of MidSouth, and to furnish MidSouthus with copies of all the reports they file.  To MidSouth’sour knowledge, based on a review of reports furnished to MidSouth,given us, all required reports were filed timely.

- 7 -

___________________

-6-

SECURITY OWNERSHIP OF MANAGEMENT
AND CERTAIN BENEFICIAL OWNERS


Security Ownership of Management


The following table sets forth certain informationshows as of March 21, 2005, concerning31, 2008, the beneficial ownership of Commonour Stock by each director and nominee, of MidSouth, by each executive officer named in the Summary of Executive Compensation Table below, and by all directors and executive officers as a group.  Unless otherwise indicated, the securities areStock is held with sole voting and investment power.
         
  Amount and Nature    
  of Beneficial  Percent 
Name Ownership(1)  of Class 
         
Will G. Charbonnet, Sr.  125,819(1,2)  2.79%
         
C. R. Cloutier  285,703(1,3)  6.29%
         
James R. Davis, Jr.  63,632(4)  1.41%
         
Karen L. Hail  103,898(5)  2.30%
         
J. B. Hargroder, M.D.  355,879(1,6)  7.91%
         
Clayton Paul Hilliard  170,781(7)  3.79%
         
Milton B. Kidd, III, O.D.  165,538(8)  3.68%
         
Stephen C. May  103,575(9)  2.31%
         
Ron D. Reed  7,262   .16%
         
William M. Simmons  147,245(10)  3.27%
         
Joseph V. Tortorice, Jr.  50,827   1.13%
         
Lonnie C. Weir  7,791   .17%
         
Jennifer S. Fontenot  23,699(11)  .53%
         
Donald R. Landry  78,157(12)  1.73%
         
A. Dwight Utz  7,977(13)  .18%
         
All directors and  1,728,960   36.92%
executive officers as a group (18 persons)        

Name
 
Amount and Nature of Beneficial Ownership(1)
  
Percent of Class
 
Will G. Charbonnet, Sr.  161,345(1,2)  2.39%
C. R. Cloutier  404,278(1,3)  5.96%
James R. Davis, Jr.  75,365(4)  1.11%
Karen L. Hail  106,255(5)  1.57%
J. B. Hargroder, M.D.  457,502(1,6)  6.77%
Clayton Paul Hilliard  250,987(7)  3.71%
Milton B. Kidd, III, O.D.  241,942   3.58%
Timothy J. Lemoine  24,875(8)  .37%
R. Glenn Pumpelly  15,779   .23%
William M. Simmons  215,211(9)  3.18%
Joseph V. Tortorice, Jr.  86,607   1.28%
J. Eustis Corrigan, Jr.  9,871(10)  .15%
Donald R. Landry  106,068(11)  1.57%
A. Dwight Utz  16,586(12)  .24%
All directors and executive officers as a group (17 persons)  2,222,111   32.64%

_______________
(1)Common Stock held by MidSouth’s Directors’our Directors' Deferred Compensation Trust (the “Trust”) is  beneficially owned by its Plan Administrator, MidSouth’sour Executive Committee, the members of which could be deemed to share beneficial ownership with respect toof all Common Stock held in the Trust (230,818(347,361 shares or 5.14% as of March 21, 2005)31, 2008).  For each director, the table includes

- 8 -

the number of shares held for his or her account only, while the group figure includes all shares held in the Trust at March 21, 2005. CommonTrust.  Stock held by MidSouth’sour Employee Ownership Plan (the “ESOP”) is not included in the table, except that shares allocated to an individual’sindividual's account are included as beneficially owned by that individual.  Shares which may be acquired by exercise of currently exercisable options (“Current Options”) are deemed outstanding for purposes of computing the percentage of outstanding Common Stock owned by persons beneficially owning such shares and by all directors and executive officers as a group but are not otherwise deemed to be outstanding.

(2)Includes 31,25347,826 shares as to which he shares voting and investment power, 33,132 shares held for his account in the Trust and 15,081 shares, which he may acquire within 60 days pursuant to currently exercisable stock options (“Current Options”).power.

(3)Includes 35,647 shares held by the ESOP for his account, 103,629227,927 shares as to which he shares voting and investment power, 40,343 shares held for his account in the Trust, and 53,436 shares under Current Options.power.  Mr. Cloutier’sCloutier's address is P. O. Box 3745, Lafayette, Louisiana 70502.

(4)Includes 8,4028,998 shares as to which he shares voting and investment power, 26,201 shares held for his account in the Trust and 15,081 shares under Current Options.power.

-7-
(5)Includes 34,806 shares held for her account in the ESOP, 8661,244 shares as to which she shares voting and investment power, 25,874 shares held for her account in the Trust and 34,239 shares under Current Options.power.

(6)Includes 308,923404,477 shares as to which he shares voting and investment power, 35,625 shares held for his account in the Trust, and 11,331 shares under Current Options.power.  Dr. Hargroder’sHargroder's address is P. O. Box 1049, Jennings, Louisiana 70546.

(7)Includes 107,252131,303 shares as to which he shares voting and investment power, 15,073 shares held for his account in the Trust and 15,081 shares under Current Options.power.

(8)Includes 11,892 shares held for his account in the Trust and 7,581 shares under Current Options.
(9)Includes 3,575 shares under Current Options.
(10)Includes 4,22120,539 shares as to which he shares voting and investment power, 34,151 shares held for his account in the Trust, and 11,331 shares under Current Options.power.

(11)(9)Includes 17,223 shares held for her account in the ESOP and 6,476 shares under Current Options.
(12)Includes 34,5066,092 shares as to which he shares voting and investment power, 16,151 shares held for his account in the ESOP and 10,098 shares under Current Options.power.

(13)(10)Includes 2,2555,719 shares as to which he shares voting and investment power, 922power.

(11)Includes 51,468 shares held for his account in the ESOPas to which he shares voting and 4,800investment power.

(12)Includes 1,555 shares under Current Options.as to which he shares voting and investment power.

_______________________

- 9 -


-8-

The following table shows the number of shares in the Trust and ESOP, and the number of shares subject to Current Options, that have been included in the above Ownership Table.
Name
 
Trust
  
ESOP
  
Current
Options
 
Will G. Charbonnet, Sr.  49,307   --   -- 
C. R. Cloutier  60,040   40,238   24,816 
James R. Davis, Jr.  38,994   --   -- 
Karen L. Hail  38,507   53,477   -- 
J. B. Hargroder, M.D.  53,025   --   -- 
Clayton Paul Hilliard  22,425   --   -- 
Milton B. Kidd, III, O.D.  17,687   --   -- 
Timothy J. Lemoine  4,336   --   -- 
R. Glenn Pumpelly  --   --   -- 
William M. Simmons  50,826   --   -- 
Joseph V. Tortorice, Jr.  622   --   -- 
J. Eustis Corrigan, Jr.  --   --   19,688 
Donald R. Landry  --   25,507   -- 
A. Dwight Utz  --   2,399   12,813 

Security Ownership of Certain Beneficial Owners


The following table sets forth certain informationlists as of March 21, 2005, concerning31, 2008, the only persons other than the persons listed in the table above known to MidSouthus to be the beneficial owner ofbeneficially own more than five percent of its Commonour Stock.
       
Name and Address Shares Beneficially Percent
Of Beneficial Owner Owned of Class
MidSouth Bancorp, Inc., Employee Stock Ownership Plan, ESOP Trustees and ESOP Administrative Committee P. O. Box 3745, Lafayette, LA 70502 381,166(1) 8.49 %
       
MidSouth Bancorp, Inc.,(2) Directors Deferred Compensation Plan, Executive Committee P. O. Box 3745, Lafayette, LA 70502
  230,818  5.14 %

Name and Address of Beneficial Owner
 
Shares Beneficially Owned
  
Percent of Class
 
MidSouth Bancorp, Inc., Employee Stock Ownership Plan,
ESOP Trustees and ESOP Administrative Committee
P. O. Box 3745, Lafayette, LA 70502
  530,462(1)  7.84%
MidSouth Bancorp, Inc., (2)
Directors Deferred Compensation Plan,
Executive Committee
P. O. Box 3745, Lafayette, LA 70502
  347,361   5.14%
___________________
(1)  The Administrative Committee directs the Trustees how to vote the approximately 10,3754,966 unallocated shares of Common Stock in the ESOP as of March 21, 2005.31, 2008.  Voting rights of the shares allocated to ESOP participants’participants' accounts are passed through to them.  The Trustees have investment power with respect to the ESOP’sESOP's assets, but must exercise it in accordance with an investment policy established by the Administrative Committee. The Trustees are Donald R. Landry, an executive officer, of MidSouth, and Katherine Gardner and Brenda Jordan, two Bank employees.  The  Administrative Committee consists of employees Polly Leonard an employee,and Felicia Savoie and Teri S. Stelly, an executive officer of MidSouth, and Dailene Melancon, a Bank officer.Stelly.

(2)  See Note (1) to the Table of Security Ownership of Management.

_________________________

- 10 -


-9-


Certain Transactions

Directors, nominees and executive officers and their associates have been customers of, and have borrowed from, our bank subsidiaries in the ordinary course of business, and such transactions are expected to continue in the future.  In the opinion of management, our loan policy is less favorable to those persons than to other customers.

C. R. Cloutier and his wife, Brenda Cloutier have pledged 15,000 shares of our Stock to Whitney Bank securing a loan in the amount of $284,000 for their daughter's daycare business.  Additionally, Mr. and Mrs. Cloutier have pledged 6,979 shares of our Stock to First National Banker's Bank to secure a personal loan in the amount  of $140,000.

James R. Davis has pledged 27,355 shares of our  Stock to Capital One Investments  to secure a $250,000 line of credit.

C. P. Hilliard has pledged 43,572 shares of our Stock to MidSouth Bank as partial security  on a $1,000,000 line of credit with a balance outstanding of $296,423.
_________________________


-10-

EXECUTIVE COMPENSATION
COMPENSATION DISCUSSION AND CERTAIN TRANSACTIONS

Summary of Executive Compensation

ANALYSIS

The following table showsCompensation Discussion and Analysis may contain statements regarding future individual and company performance targets or goals.  We have disclosed these targets or goals in the limited context of the Company’s compensation programs; and, therefore, you should not take these statements to be statements of management’s expectations or estimates of results or other guidance.  We specifically caution investors not to apply such statements to other contexts.

This Compensation Discussion and Analysis provides insight into the Company’s executive compensation programs.  It explains the philosophy underlying our compensation strategy and the fundamental elements of compensation paid to our Chief Executive Officer, Chief Financial Officer, and other individuals included in the Summary Compensation Table (“Named Executive Officers”).  Specifically, this Compensation Discussion and Analysis addresses the following:

·  Objectives of our compensation programs;
·  What our compensation programs are designed to reward;
·  Elements of compensation provided to our executive officers;
­  The purpose of each element of compensation
­  Why we elect to pay each element of compensation
­  How each element of compensation was determined by the Committee
­  How each element and our decisions regarding its payment relate to our goals
·  Process for determining executive officer compensation; and
·  Other important compensation policies affecting our executive officers.

During 2007, the Company began a restructuring process to meet the demands and changes of the business brought on by the rapid growth and increase in size of the Company.  The restructuring process impacted the implementation of changes in Named Executive Officer compensation during 2007, as well as the allocation of various compensation elements to these employees during the past year.  Throughout this document we highlight the specific impact of this process as we discuss the Company’s executive compensation elements and programs.

The Personnel Committee of the Board of Directors (“Committee”) administers our executive compensation programs.  During 2007, the Committee consisted of Will Charbonnet, Sr. (Chairman), James R. Davis, Jr., J. B. Hargroder, M.D., and Joseph V. Tortorice, Jr.  The members of the Committee all qualify as independent, outside members of the Board of Directors in accordance with the requirements of the American Stock Exchange (AMEX), current SEC regulations, and section 162(m) of the Internal Revenue Code.
Objectives of Our Compensation Programs
The Committee has the responsibility for continually monitoring the compensation awardedpaid to earnedour executive officers.  The Committee believes that compensation of our executive officers should encourage creation of stockholder value and achievement of strategic corporate objectives.  Specifically, the Committee ensures the total compensation package for our executive officers will serve to:
-11-
·  Attract, retain, and motivate outstanding executive officers who add value to the Company based on individual and team contributions;
·  Provide a competitive salary structure in all markets where we operate; and
·  Align the executive officers’ interests with the long-term interests of our shareholders to incent them to enhance shareholder value.
What Our Compensation Programs Are Designed to Reward
Our executive officers' compensation is designed to reward short term performance as well as long term performance.  Our policy is to provide a large portion of compensation in cash, including an annual base salary, and an opportunity to receive an annual incentive that is based on basic earnings per share (EPS).  We provide this to keep the executive officers focused on current earnings and stability and to strongly align the executives with the interests of our shareholders.  We also view the annual incentive as a long term performance vehicle because we examine performance measures including credit quality, credit risk management, deposit growth, regulatory compliance, return on equity, and growth in our assets and income when assessing incentive grants to the executive officers.  Credit quality, non accruals, and charge offs are impacted by long term performance such that performance in the current year affects these measures in future years.

Additionally, we have historically provided additional compensation benefits through our 1997 Stock Incentive Plan and our Employee Stock Ownership Plan (ESOP), which keeps the executive officers focused on our long term goals. On a going forward basis, we will continue with our ESOP and will be providing equity compensation through our shareholder approved 2007 Omnibus Incentive Plan.

Over the last several years, our performance has been above average as compared to similarly situated financial institutions, and the compensation programs are designed to reward and promote the continuation of this performance.  We aim to provide a substantial portion of executive officers compensation in the form of performance based compensation through the annual incentive opportunity.  Therefore, the increase in the executive officers compensation over the past few years is based on this exceptional performance.
Process for Determining Executive Officer Compensation
•   Role of the Committee and the Executive Officers. The Committee along with the Board of Director’s oversight and approval will annually review and approve goals and objectives relating to compensation of the Chief Executive Officer.  Based on this evaluation, the Committee recommends the Chief Executive Officer’s compensation level to the Board of Directors.  The Committee also consults with the Chief Executive Officer on the compensation levels of the other executive officers.  Based on these discussions, the Committee will recommend, along with the Chief Executive Officer, the other executive officers compensation levels to the Board of Directors.

Additionally, the Committee periodically reviews our incentive plans and other equity based plans.  The Committee reviews, adopts, and submits to the Board of Directors any proposed arrangement or plan and any amendment to an existing arrangement or plan that provides or will provide benefits to the executive officers collectively or to an individual executive officer.  The Committee has sole authority to retain and terminate a compensation consultant or other advisor as the Committee sees appropriate.

-12-
•   Role of the Compensation Consultant.  In making compensation decisions for 2007, the Committee did not have a contractual arrangement with a compensation consultant to advise in setting the amount or determining the form of compensation to the executive officers.

At the end of 2007, the Committee engaged Amalfi Consulting LLC (formerly the Compensation Practice of Clark Consulting) to conduct an overall compensation review of the Company’s top executive employees, including all of the five Named Executive Officers presented in this proxy.  The results of the compensation review will be used on a going-forward basis in making compensation decisions related to the top executive employees of the Company.

In addition to the overall compensation review, Amalfi Consulting LLC assisted the Company with the creation of plan documents related to executive compensation programs and with the production of this proxy filing.  Amalfi Consulting LLC reported directly to the Committee on all projects conducted and performed no other services for the Company in 2007.

•   Benchmarking. To ensure the competitiveness of our total compensation package, the Committee uses salary survey information from several different nationally recognized surveys that focus on our industry and region. Specifically, the Company used salary survey information compiled by K G & Associates that included surveys from Watson Wyatt and Mercer.  This information was used to evaluate how comparable institutions are paying their executive management.  In 2007, K G & Associates conducted no other business with the Company.  Along with the data compiled by K G & Associates, the Committee considered data from an additional compensation survey conducted by Scheshunoff Management Services.

In using survey data, we benchmark both base salary and annual incentive.  Long term incentives are not benchmarked because we feel that long term incentives are not part of the basic compensation of the executive officers.  Long term incentives are viewed as an additional opportunity for the executive officer based on the value of our stock price.

Based on our prior year earnings, the total cash compensation paid to the Named Executive Officers, for all services renderedwhich includes base salary and annual incentive, is approximately at the 75th percentile of compensation market levels as reported by themthe surveys.

As noted earlier, at the end of 2007 the Committee, in all capacitiescoordination with Amalfi Consulting LLC, conducted an overall review of the executive compensation program.  As part of this review, a peer group of 20 banks comparable to MidSouth in terms of geographic location, asset size, growth and its subsidiariesperformance was selected. We present the peer group in the table below.  Values reported in the table are as of year-end 2006.

-13-

Benchmarking Peer Group
     Total AssetsAsset GrowthROAAROAE
     2006Y3 Yr2006Y2006Y
 Company NameTickerCityState($000)(%)(%)(%)
1First M&F CorporationFMFCKosciuskoMS1,540,27542.8%0.94%11.4%
2Great Florida BankGFLBACoral GablesFL1,535,981NA0.57%3.7%
3ViewPoint Financial Group (MHC)VPFGPlanoTX1,529,76016.5%0.65%6.8%
4Southern Community Financial CorporationSCMFWinston-SalemNC1,436,46579.8%0.31%3.1%
5BancTrust Financial Group, Inc.BTFGMobileAL1,353,40625.7%1.02%9.7%
6Encore Bancshares, Inc.EBTXHoustonTX1,336,8430.8%0.57%8.3%
7TIB Financial Corp.TIBBNaplesFL1,319,09397.1%0.76%11.4%
8MetroCorp Bancshares, Inc.MCBIHoustonTX1,268,43446.3%1.13%13.6%
9CenterState Banks of Florida, Inc.CSFLWinter HavenFL1,077,10276.9%0.86%7.7%
10Florida Community Banks, Inc.FLCMImmokaleeFL1,016,67793.5%2.31%28.9%
11Peoples Financial CorporationPFBXBiloxiMS964,02366.3%1.40%14.0%
12Pulaski Financial Corp.PULBSaint LouisMO962,460139.8%1.14%15.0%
13Peoples BancTrust Company, Inc.PBTCSelmaAL910,70517.0%0.95%9.5%
14Nexity Financial CorporationNXTYBirminghamAL891,02270.5%0.75%9.8%
15Bank of Florida CorporationBOFLNaplesFL883,102296.7%0.32%2.3%
16First Federal Bancshares of Arkansas, Inc.FFBHHarrisonAR852,47523.4%0.85%9.4%
17Federal Trust CorporationFDTSanfordFL722,96454.4%0.46%6.7%
18United Security Bancshares, Inc.USBIThomasvilleAL646,29613.9%2.24%16.1%
19Auburn National Bancorporation, Inc.AUBNAuburnAL635,1267.6%1.06%14.7%
20Sun American BancorpSAMBBoca RatonFL503,883435.5%0.97%5.1%
 Average   1,069,30584.4%0.96%10.4%
 50th Percentile   990,35054.4%0.90%9.6%
 MidSouth Bancorp, Inc.MSLLafayetteLA805,02286.0%1.08%14.7%

Although we did not use the data from this review to assess or change compensation programs for our Named Executive Officers during 2007, we plan to use the information from the review to make decisions on a going-forward basis for 2008.
Elements of Compensation
We have determined that it is our and our shareholders’ best interest to provide competitive compensation to attract and retain the most qualified executive officers with demonstrated leadership abilities that will secure our future.  We do this by providing compensation that is tied to our short and long term performance goals to motivate our executive officers to attain these goals.

The performance goals that we examine may include credit quality, credit risk management, deposit growth, regulatory compliance, return on equity, and growth in our assets and income.

We have not made any material changes in individual compensation in 2007 compared to 2006.  In addition, due to possible changes in roles and responsibilities as a result of the restructuring, adjustments to base salary salaries and other compensation elements have been postponed until 2008.

-14-
The elements of compensation used during 2007 to compensate the executive officers include:
·  Base Salary;
·  Annual Incentives;
·  Retirement Benefits;
·  Health and Insurance Plans;
·  Long Term Equity Awards; and
·  Perquisites.

Below is a discussion of each element of compensation listed above, including the purpose of each element of compensation, why we elect to pay each element of compensation, how each element of compensation was determined by the Committee, and how each element and our decisions regarding the payment of each element relate to our goals.

•   Base Salary. Although we favor the use of incentive compensation, we believe it is necessary and prudent to pay a portion of total compensation in the form of a competitive fixed base salary.  We believe the payment of a fixed base salary to our executive officers helps maintain productivity by minimizing anxiety that a financial or industry slump could impair their personal and family planning.

It is our goal to set base salary to reflect the role and responsibility of the executive officer over time and to comfortably meet the executive’s needs.  Base salary, although not directly connected to performance, is essential to compete for talent and our failure to pay a competitive base salary could harm our ability to recruit and retain management.  Base salary was initially determined by analyzing base salaries of comparable executives in the marketplace and considering the abilities, qualifications, accomplishments, prior work experience, and cost of living of the executive officer.

When setting base salary levels, the Committee takes into account the total direct cash compensation amount targeted for each executive.  Essentially, base salary is established by determining the amount of money in combination with the anticipated amount of annual incentive that was necessary to attract and retain top caliber executive officers.

Base salary adjustments are generally considered annually in December on a discretionary basis and take into account the executive officer’s individual performance over the prior year, changes in the executive officer’s responsibilities, our performance, and market levels of compensation.

In December of 2005 and 2006, the Committee recommended to the Board 2006 and 2007 base salary for the past three years. NoChief Executive Officer and in consultation with the Chief Executive Officer 2006 and 2007 base salary for the other executive officers except for Mr. Corrigan’s 2006 base salary.  Mr. Corrigan was hired during 2006 and his base salary for 2006 was set by the Chief Executive Officer and approved by the Committee upon his hire date.


-15-

Base salary for 2006 and 2007 for each of the Named Executive Officers is as follows:

  2006 Base Salary  
2007 Base
Salary
  
%
Increase
 
C.R. Cloutier $196,000  $200,000   2.0%
J. Eustis Corrigan Jr. $165,000  $175,000   6.1%
Karen L. Hail $149,595  $157,000   5.0%
Donald R. Landry $139,552  $147,000   5.3%
A. Dwight Utz $98,348  $112,000   13.9%

The 13.9% increase for Mr. Utz reflects both an increase in job responsibility occurring in 2007, and a market pay adjustment.  The 6.1% increase for Mr. Corrigan is based upon terms of his employment agreement associated with his hire in 2006.  Other increases reflect normal merit and market adjustments.

As noted earlier, due to the restructuring activities of the Company decisions on bases salary adjustment for 2008 have not been determined.  Once base salary decisions have been made, the new salaries will be made effective retroactively to January 1, 2008.

•   Annual Incentives. Annual incentives are provided to the executive officers through the Company’s Incentive Compensation Plan (CICP).

Company’s Incentive Compensation Plan (CICP)
Annual incentives are primarily designed to reward increased shareholder value as well as to focus the executive officers on our goals for a particular year and to reward executive officers upon achievement of those goals.  We believe annual incentives are an important element of executive officers’ compensation because they provide the incentive and motivation to lead us in achieving success. The annual incentive under the CICP is tied to basic earnings per share (EPS) and makes up a very significant part of the executive officer’s compensation.  If the executive officer is able to significantly improve our performance then the executive officer will have a significant increase in annual incentive for the year.  If the performance is below expectations then the executive officer will have a reduction in compensation.

We use a system of MidSouth had total annual salaryincentives to reward the executive officers quarterly based on EPS.  Before the beginning of each year, the Committee awards each executive officer a specified number of phantom shares of our stock.  Annual incentive is determined quarterly equal to the number of phantom shares times our basic EPS for the quarter.  Sixty percent of the amount determined is paid each quarter and bonus exceeding $100,000the balance is paid at the end of the year, provided we were profitable for the entire year.  If we are not profitable for the year (i.e., the fourth quarter results in 2004.a large loss) then the balance that was held back will not be paid.
                                 
                  Long-Term Compensation    
              Other             
Name and             Annual  Restricted  Securities       
Principal             Compen-  Stock  Underlying  LTIP  All Other 
Position Year  Salary(1)  Bonus(2)  sation  Award(s)  Option(s)  Payouts  Compen-sation(3) 
C. R. Cloutier  2004  $222,029  $92,516   0   0   0   0  $8,892 
President & Chief  2003  $212,504  $76,680   0   0   0   0  $8,895 
Executive Officer  2002  $204,275  $49,320   0   0   12,500   0  $8,678 
                                 
Karen L. Hail  2004  $152,037  $55,509   0   0   0   0  $6,962 
Senior Exec VP &  2003  $145,417  $46,008   0   0   0   0  $6,598 
Chief Oper. Off.  2002  $139,283  $29,592   0   0   6,000   0  $5,619 
                                 
Donald R. Landry  2004  $113,740  $43,945   0   0   0   0  $6,657 
Exec. VP & Chief  2003  $110,063  $36,423   0   0   0   0  $6,192 
Lending Officer  2002  $105,833  $23,427   0   0   5,000   0  $5,433 
                                 
A. Dwight Utz  2004  $92,000  $30,068   0   0   500   0  $4,232 
Senior VP & Retail  2003  $92,000  $22,543   0   0   1,000   0  $4,071 
Executive Manager  2002  $92,000  $11,813   0   0   0   0  $1,734 
                                 
Jennifer Fontenot  2004  $78,500  $31,442   0   0   500   0  $3,812 
Senior VP/Chief  2003  $75,000  $20,136   0   0   1,000   0  $1,622 
Info. Officer  2002  $74,673  $12,330   0   0   0   0  $490 

(1)Includes director fees of $26,350 and $25,750 for 2004, $24,550 and $24,325 for 2003, and $25,925 and $24,950 for 2002 for Mr. Cloutier and Ms. Hail, respectively.
(2)Awarded pursuant to the Incentive Compensation Plan of the Bank.
(3)Consists of $7,108, $6,303, $5,885, $4,232 and $3,812 contributed by MidSouth to the ESOP for the accounts of each of Mr. Cloutier, Ms. Hail, Mr. Landry, Mr. Utz, and Ms. Fontenot, respectively; and $1,784, $659 and $772 paid by MidSouth in insurance premiums for term life insurance for the benefit of Mr. Cloutier, Ms. Hail and Mr. Landry, respectively.

_____________________

- 11 -

Option Holdings

The following table sets forth information with respectnumber of phantom shares granted each year is generally considered in December on a discretionary basis and takes into account the executive officer’s individual performance compared to the prior year, his or her importance to us, and our overall financial performance.  The granting of phantom shares as the annual incentive in lieu of awarding cash bonuses is preferred by the Committee.


-16-
In December of 2006 and 2007, the Committee granted phantom shares for 2007 and 2008 to each of the Named Executive Officers.  Phantom shares were granted to the Named Executive Officers concerning unexercised options heldfor 2007 and 2008 as follows:

  Phantom Share Grants 
Named Executive Officer 2007  2008 
 # of Shares  
Dollar Value Earned(1)
  # of Shares  
Dollar Value Estimate(1)
 
C.R. Cloutier  125,000  $173,750   131,250  $175,875 
J. Eustis Corrigan Jr.  37,500  $52,125   39,375  $52,763 
Karen L. Hail  62,500  $86,875   65,625  $87,938 
Donald R. Landry  45,000  $62,550   47,250  $63,315 
A. Dwight Utz  27,549  $38,293   28,926  $38,761 
(1) Both earned and estimated amounts based upon a 12/31/2007 basic undiluted EPS value of December 31, 2004.

Option Values As$1.34.  The share numbers were adjusted during 2007 to reflect a 5% stock dividend on September 19, 2007.  The number of December 31, 2004

                 
  Number of Securities Value of Unexercised
  Underlying Unexercised In-the-Money Options
  Options at At
Name December 31, 2004 December 31, 2004(1)
  Exercisable Unexercisable Exercisable Unexercisable
C. R. Cloutier  53,436   10,313  $1,045,172  $180,890 
                 
Jennifer Fontenot  6,076   1,725  $132,496  $15,141 
                 
Karen L. Hail  34,239   4,950  $693,909  $86,823 
                 
Donald Landry  10,098   4,125  $164,186  $72,353 
                 
A. Dwight Utz  4,400   4,475  $82,090  $67,199 

(1)Reflects the difference between the closing sale price of a share of MidSouth Common Stock on December 31, 2004, and the exercise price of the options.

Option Exercises

shares for 2007 represents the amount of shares allocated at the beginning of the plan year. The following table contains information with respect2008 numbers reflect the impact of the 5% stock dividend.


•   Long Term Equity Awards. Salary and annual incentives tend to reward shorter term goals; however, it is important to focus on long term performance, which is why we have historically granted stock options.  A stock option only rewards the executive if our stock price increases over a period of time. Due to the Named Executive Officer concerning options exercised in 2004.
Shares Acquired
NameOn ExerciseValue Realized
C. R. Cloutier2,500$56,125(1)
Donald Landry13,922$398,726(2)

(1)Reflects the difference between the $27.30 closing pricerestructuring activities of the Common Stock on December 28, 2004, and the respective exercise price of the options.
(2)Reflects the difference between the $34.70 closing price of the Common Stock on March 19, 2004, and the respective exercise price of the options.

- 12 -

Stock Option Grants

     The following table sets forth information concerning the grant ofCompany, the Committee did not award stock options to any of the Named Executive Officers in 2004.

Stock Option Grants2007.  All long-term equity award programs will be reviewed during 2008.

                         
                  Potential Realization 
                  Value of Assumed 
      % of Total          Annual Rates of Stock 
  No. of Shares  Options to          Price Appreciation for 
  Underlying  Employees  Exercise  Expiration  Option Term 
Name Options  In 2004  Price(1)  Date  5%  10% 
Jennifer Fontenot  625   4.69% $28.40  Feb. 26, 2014 $350  $1,213 
A. Dwight Utz  625   4.69% $28.40  Feb. 26, 2014 $350  $1,213 

(1)The exercise price represents the fair market value
The Company did make contributions to the ESOP in 2007 on behalf of the MidSouth Common Stock on the date of grant. The options are not exercisable for one year from the date of grant and become exercisable thereafter in 20% increments each year, unless exerciseability is accelerated by the Personnel Committee or upon a change in control of MidSouth.

Employment and Severance Contracts with Named Executive Officers.  It is our belief that executive officers need to have a significant interest tied to long term performance and increasing shareholder value.  We believe the best way to accomplish this is through stock ownership of the Company.  We encourage executive officers to own stock and provide the following programs to encourage stock ownership. We describe our employee stock ownership plan, our 1997 Stock Incentive Plan, and our 2007 Omnibus Incentive Compensation Plan below.


Employee Stock Ownership Plan:  To encourage ownership by all employees and therefore tie their interest to the interests of the shareholders, we established an employee stock ownership plan (“ESOP”) in 1986.  The ESOP covers all employees who meet minimum age and service requirements. We make annual contributions to the ESOP in amounts as determined by the Board of Directors.

1997 Stock Incentive Plan:  In addition to the ESOP, we have periodically granted stock options to executive officers and other senior employees.  Our policy has been to grant stock options to executive officers to ensure that they have options currently outstanding.  To the extent that the executive officer has unvested options outstanding, we feel that the executive officer is tied to our long term performance and will only grant additional awards to the extent that all awards are vested. We have historically granted to executive officers stock options that vest 20% per year over a 5 year period.  During 2007, this equity-based incentive plan was replaced with the shareholder approved omnibus incentive plan described below.

2007 Omnibus Incentive Plan:  In 2007 we received shareholder approval for an Omnibus Incentive Plan.

-17-

No equity awards were made under this plan in 2007.  This plan provides the Company with flexibility in the design and implementation of long-term equity award programs.  Under this plan the Committee may award a variety of forms of equity such as restricted stock, stock appreciation rights, and performance shares.  For details on the plan please refer to the Company’s 2007 Proxy filed on May 30, 2007.

Stock option grants always have an exercise price equal to our stock price at the time they are awarded.  We never engaged in the back-dating of stock options nor have we retroactively modified our stock option awards.

We grant stock options upon hire of an executive officer, upon exceptional achievement, or to ensure that an executive officer has outstanding unvested options.  We did not provide any additional long term compensation under the Stock Incentive Plan in 2007

We believe that stock options are the preferable method of incenting and rewarding long term performance because stock options provide incentive to increase shareholder value and serve as a good retention vehicle for the Named Executive Officers.

•   Perquisites. The Company provided the following perquisites in 2007 to certain executive officers:
­  Company car;
­  Moving expenses;
­  Country club membership;
­  Health club membership;
­  Dinner club membership; and
­  Supplemental long-term disability and life insurance.

The total cost for all of these perquisites was approximately $38,000.  We provide further details on perquisites in a supplementary table following the Summary Compensation Table in this document.

The Named Executive Officers

are all eligible to receive additional perquisites if the Committee so determines. We view certain perquisites as beneficial to us as well as compensation to the executive officers.  For example, the club memberships are regularly used in the general course of our business such as for business meetings or entertaining.  The Company cars are used primarily for business purposes.


•   Retirement Benefits. We do not have a defined benefit pension plan.  However, executive officers are eligible to participate in our 401(k) retirement plan, which is a Company-wide, tax-qualified retirement plan.  The intent of this plan is to provide all employees with a tax-advantaged savings opportunity for retirement.  We sponsor this plan to help employees in all levels of the Company save and accumulate assets for use during their retirement.  As required, eligible pay under this plan is capped at Internal Revenue Code (IRC) annual limits.  We make annual matching contributions to the 401(k) retirement plan on behalf of the executive officers.

We have entered into Executive Indexed Salary Continuation Agreements with Mr. Cloutier, Ms. Hail, and Mr. Landry.  The agreements provide that upon the executive officer reaching normal retirement age the executive officer will receive payment of amounts as defined in the agreement and presented in the narrative of the Nonqualified Deferred Compensation section of this document.

-18-
•   Health and Insurance Plans. The executive officers are eligible to participate in Company-sponsored benefit plans on the same terms and conditions as those generally provided to salaried employees.  Basic health benefits, dental benefits, and similar programs are provided to make certain that access to healthcare and income protection is available to our employees and the employee’s family members.  The cost of Company-sponsored benefit plans are negotiated with the providers of such benefits and the executive officers contribute to the cost of the benefits.

The Company maintains a split dollar insurance arrangement with Mr. Cloutier, Ms. Hail and Mr. Landry.  The arrangement provides benefits to the executive officer’s designated beneficiary in the event of the executive officer’s death.

Additionally, we provide Mr. Cloutier, Ms. Hail and Mr. Landry with a supplemental Term Life Insurance Policy payable to a beneficiary of their choice and a supplemental long-term disability policy.  We provide additional details on the benefits provided under these policies in the Potential Payments Upon Termination or Change in Control section.

•   Compensation Mix.  The Company incorporates a significant portion of the NEOs compensation in the form of annual incentives.  As noted earlier, the annual incentive plan is tied to earnings per share and provides a strong link between executive compensation and shareholder interests.  In addition, when determining compensation levels the Committee takes into consideration all the elements of compensation to arrive at a total compensation amount.

In the figures on the following page, we present the actual pay mix results during 2006 and 2007 for each of our NEOs.  Because Mr. Corrigan was hired in mid-2006, we only present his first complete year of employment at the Company.

Compensation Mix C.R. Cloutier     Compensation Mix J. Eustis Corrigan, Jr.
-19-
Compensation Mix Karen L. Hail   Compensation Mix Donald R. Landry Compensation Mix A. Dwight Utz

Other Important Compensation Policies Affecting Executive Officers
•   Financial Restatement.  Currently, the Committee does not have an official policy governing retroactive modifications to any cash or equity based incentive compensation paid to the executive officers where the payment of such compensation was predicated upon the achievement of specified financial results that were subsequently the subject of a restatement.  However, we adhere to Section 304 of the Sarbanes-Oxley Act of 2002 which requires that if a company is forced to restate its financials the company’s Chief Executive Officer and Chief Financial Officer must give back certain incentives based or equity based compensation received.

We have never retroactively modified incentives or equity based compensation for our employees.

The Incentive Compensation Plan pays out quarterly based on our EPS for each quarter; however, only 60% of the value is paid out.  The remaining 40% is held back until after year-end earnings have been determined.  If there is a decline in earnings for the year, amounts held back may not be paid to the executive officers as the annual incentive is based on our EPS.

-20-
•   Stock Ownership Requirements.  The Committee does not maintain a policy relating to stock ownership guidelines or requirements for our executive officers.  The Committee does not believe it is necessary to impose such a policy on the executive officers.  Currently, the Named Executive Officers, as a group, hold a substantial portion of the Company’s stock.  If circumstances change, the Committee will review whether such a policy is appropriate for its executive officers.

•   Trading in the Company’s Stock Derivatives.  The Committee does not have a writtenpolicy prohibiting executive officers from purchasing or selling options on our stock, engaging in short sales with respect to our stock,  or trading in puts, calls, straddles, equity swaps or other derivative securities that are directly linked to our  stock.  We are not aware that any of the executive officers have entered into these types of arrangements.

•   Tax Deductibility of the Named Executive Officers’ Incentive and Equity Compensation.  Section 162(m) of the Internal Revenue Code generally disallows a tax deduction to public companies for compensation over $1.0 million paid to a corporation’s Chief Executive Officer and the four other most highly compensated executive officers.

In connection with the compensation of our executive officers, the Committee is aware of section 162(m) as it relates to deductibility of qualifying compensation paid to executive officers.  The Committee believes that compensation to be paid in 2007 will not exceed the deductibility limitations on non-excluded compensation to certain executive officers.

•   Employment Agreements.  We have entered into employment agreements with our Chief Executive Officer, Chief Operating Officer, and Chief Financial Officer.  We will enter into a new employment agreement with an executive officer or a potential candidate only when it is essential to attract or retain an exceptional employee.  Any employment agreement with an executive officer must be approved by the Bank forBoard of Directors and should have as short a term as possible and provide as few terms and conditions as are necessary to accomplish its purpose.

All of one year, beginning January 1stthe employment agreements have trigger events that provide for the payment of severance to the executive officer upon certain termination events.  We have included these trigger events in the employment agreements to provide a safe harbor so that the executive officer can provide services to  us without being concerned about his/her employment.

We do not maintain a separate severance plan for our executive officers.  Severance benefits for our executive officers are limited to those as set forth in the respective executive officer’s employment agreement with us.

Set forth below are the general terms and conditions of each year. The agreements areof the employment agreements.  Each executive has the right to voluntarily terminate his/her employment at any time.
___________________
-21-
General
C.R. Cloutier - Chief Executive Officer
Karen L. Hail - Chief Operating Officer
Each employment agreement is a one-year written agreement and is automatically extended for one year every year thereafter, beginning on the termination date, unless written notice of termination is given by any party to the agreement not later than 60 days before the termination date. Pursuant toend of the contract,year.  Under Mr. Cloutier,Cloutier's and Ms. Hail and Mr. LandryHail's agreement, each of them receive a minimum annual base salary, term life insurance equal toin the amount of four times their annual base salary payable to a beneficiary of theirhis or her choice, and disability insurance of not less than two-thirds of their annual salary.base salary, an automobile furnished by the Company (including insurance, gasoline, and other routine maintenance), membership at a health club, and membership at a dinner club.

In the event that we terminate Mr. Cloutier’s or Ms. Hail’s and Mr. Landry’s contracts have a severance provision which entitles them to one year’s salary ifHail's employment or do not extend the agreement, is terminated byeach will be entitled to severance pay equal to annual base salary at the Bank, unless they aretime of termination.  We will not be obligated to pay any severance pay in the event that he or she terminates voluntarily or is removed by a regulatory body.

Certain Transactions


Upon a change in control of the Company, Mr. Cloutier or Ms. Hail each has the right to resign employment for Good Reason and receive as severance pay a sum equal to annual base salary immediately prior to the change in control, payable in twelve equal installments.  Good Reason is deemed to occur upon one of the following events:


(1)a reduction in the salary or benefits of the executive officer in effect before the effective date of the change in control or within two years after the effective date of the change in control;
(2)a requirement that executive officer move his residence out of Lafayette, Louisiana;
(3)a requirement that executive officer engage in excessive business travel (i.e., travel of more than 75 miles from Lafayette, Louisiana for more than an average of seven business days per month) as part of his job duties; or
(4)the executive officer’s office is moved outside of the Lafayette MSA.

None of the executive officers is entitled to receive a Gross-Up payment in the event that he or she is subject to section 280G excise tax pursuant to a change in control of the Company.

J. Eustis Corrigan, Jr. - Chief Financial Officer
Mr. Corrigan’s employment agreement provides that he will receive a minimum annual base salary and is eligible to receive all standard benefits provided by us to other employees in positions comparable to his position.  We are required to reimburse him for his COBRA premiums being paid in connection with his separation of employment from his previous employer until the date that he becomes eligible to participate in our group health insurance programs.  In addition, Mr. Corrigan received an initial grant of 30,000 phantom shares under the Incentive Compensation Plan and 15,000 stock options under our Stock Incentive Plan.  These amounts have been adjusted accordingly for the 5:4 stock split on October 24, 2006, and the 5% stock dividend on September 19, 2007.  We are required to provide him with either a health club membership or a country club membership.  The agreement also provides for the reimbursement of moving expenses incurred by Mr. Corrigan in moving from Texas to Lafayette and a signing bonus of $10,000.  Both the moving expense reimbursement and signing bonus are earned over a three-year period beginning upon date of hire.

-22-
Upon the occurrence of a change in control of the Company during the first five years of Mr. Corrigan’s employment, Mr. Corrigan shall receive a sum equal to two times his annual base salary plus his prior year annual incentive payable in equal installments over twenty-four months in the event that his employment is involuntarily terminated by the Company.

•   Tax and Accounting Implications.  We consider the tax and accounting implication regarding the delivery of different forms of compensation.  We believe that the most efficient form of compensation for the executive officers is cash and, therefore, place a greater emphasis on cash compensation over other forms (i.e., equity).
COMPENSATION COMMITTEE REPORT
The Personnel Committee has reviewed and discussed the Compensation Discussion and Analysis with management.  Based upon such review, the related discussions and such other matters deemed relevant and appropriate to the Personnel Committee, the Personnel Committee has recommended to the Board of Directors nomineesthat the Compensation Discussion and Analysis be included in this Proxy Statement to be delivered to shareholders.

Submitted by the Personnel Committee:

Will Charbonnet Sr., Chairman
James R. Davis, Jr.
J. B. Hargroder, M.D.
Joseph V. Tortorice, Jr.



-23-

SUMMARY COMPENSATION TABLE
The Summary Compensation Table below displays the total compensation awarded to, earned by or paid to the Named Executive Officers for 2006 and 2007.  All amounts shown below are in dollars.

Name and Principal PositionYear 
Salary
 ($)
  
Bonus
($)
  
Stock Awards
($)
  
Option  Awards(3)
 
($)
  
Non-Equity Incentive Plan Compensation (4)
 
($)
  
Change in Pension Value and Nonqualified Deferred Compensation Earnings (5)
 
($)
  
All Other Comp.(6)
 
($)
  
Total
($)
 
(a)
(b)
 
(c)
  
(d)
  
(e)
  
(f)
  
(g)
  
(h)
  
(i)
  
(j)
 
C.R. Cloutier, President & Chief Executive Officer                         
2006 $196,000  $0  $0  $10,069  $163,339  $0  $80,216  $449,624 
2007 $199,833  $0  $0  $4,127  $173,750  $0  $85,133  $462,843 
J. Eustis Corrigan Jr., EVP & Chief Financial Officer                                 
2006 $85,038(1) $3,333(2) $0  $13,108  $24,750  $0  $14,140  $140,369 
2007 $174,584  $3,333(2) $0  $24,650  $52,125  $0  $12,097  $266,789 
Karen L. Hail, Senior Executive VP & Chief Operating Officer                                 
2006 $149,595  $0  $0  $4,833  $82,250  $0  $61,900  $298,578 
2007 $156,709  $0  $0  $1,981  $86,875  $0  $67,995  $313,560 
Donald R. Landry, Executive VP & Chief Lending Officer                                 
2006 $139,552  $0  $0  $4,028  $57,733  $0  $36,414  $237,727 
2007 $146,708  $0  $0  $1,651  $62,550  $0  $35,513  $246,422 
A. Dwight Utz, Senior VP & Retail Executive Manager                                 
2006 $98,348  $0  $0  $5,373  $44,346  $0  $10,172  $158,239 
2007 $112,000  $0  $0  $1,942  $38,293  $0  $10,428  $162,663 

___________________

(1)Mr. Corrigan was hired effective June 12, 2006 with a base salary of $165,000.  Base salary above reflects amounts from beginning of his employment through December 31, 2006

(2)Mr. Corrigan received a $10,000 signing bonus upon his hire in 2006.  He will earn this bonus ratably over a three-year period beginning on his hire date.

(3)Reflects compensation expense recognized for financial statement reporting purposes for 2006 and 2007 computed in accordance with Statement of Financial Accounting Standards No. 123 (revised 2004) Share Based Payment (“FAS 123R”), disregarding the estimate of forfeitures related to service-based vesting conditions, with respect to awards granted in 2006 and in prior years.
Assumptions used in the calculation of this amount are included in footnote 11 to our audited financial statements for 2006 included in our Annual Report on Form 10-K filed with the Securities and Exchange Commission ("SEC"), footnote 1 to our audited financial statements for 2004 included in the Company’s Annual Report on Form 10-K filed with the SEC and footnote 12 to the audited financial statements for 2003 included in our Annual Report on Form 10-KSB filed with the SEC.

(4)Amounts paid out pursuant to our Incentive Compensation Plan for awards granted in December 2005 for 2006 consist of phantom shares granted of 124,118 to Mr. Cloutier, 62,500 to Ms. Hail, 43,870 to Mr. Landry, and 24,579 to Mr. Utz.  Grants of phantom shares for 2006 have been adjusted for the 5:4 stock split on October 24, 2006.  The phantom shares paid out based on the basic undiluted earnings per share of $1.316 on year-ending 12/31/2006.  In 2006, Mr. Utz earned $12,000 per the terms of a Supplemental Incentive Compensation plan based upon deposit and loan goals. This was the last year of Mr. Utz’s participation in the Supplemental Incentive Compensation plan.
-24-
Pursuant to Mr. Corrigan’s employment agreement, he was granted 37,500 phantom shares upon his hire date, which has been adjusted for the 5:4 stock split on October 24, 2006.  Mr. Corrigan’s phantom shares paid out based on a value of $0.66, the combined 3rd quarter and 4th quarter earnings per share for the 2006 calendar year.
Amounts paid out pursuant to our Incentive Compensation Plan for awards granted in December 2006 for 2007 consist of phantom shares granted of 129,664 to Mr. Cloutier, 38,899 to Mr. Corrigan Jr., 64,832 to Ms. Hail, 46,679 to Mr. Landry, and 28,577 to Mr. Utz.  Phantom share amounts have been adjusted from numbers awarded on December 31, 2006 to account for the 5% stock dividend on September 19, 2007.  The phantom shares paid out $1.34, the basic undiluted earnings per share for the year-ending 12/31/2007.

(5)The Company does not provide pension benefits and there were no above market earnings on deferred compensation in 2006 or 2007.
(6)We provide details on the amounts reported for “All Other Compensation” in the supplementary table below.
All Other 
C.R. Cloutier,
President & Chief Executive Officer
  J. Eustis Corrigan Jr., EVP & Chief Financial Officer  
Karen L. Hail,
Senior Executive VP & Chief Operating Officer
  Donald R. Landry, Executive VP & Chief Lending Officer  
A. Dwight Utz, Senior VP &
Retail Executive Manager
 
  Compensation 2006  2007  2006  2007  2006  2007  2006  2007  2006  2007 
Auto Expense(1)
 $103  $169   --   --  $1,764  $1,487  $896  $731  $476  $493 
Board of Director Fees(2)
 $41,700  $47,100   --   --  $30,400  $37,750  $8,225  $7,125   --   -- 
Cell Phone/PDA $1,740  $1,960  $614  $1,149  $572  $572  $867  $1,115  $828  $1,076 
Club Membership/Dues(3)
 $3,697  $2,980  $7,239  $3,830  $1,205  $1,205  $3,863  $4,489  $1,064  $1,197 
Employer 401K Contribution $1,371  $1,817  $0  $0  $1,371  $1,058  $1,005  $727  $858  $1,064 
Company Contribution to Indexed Salary Continuation Plan Pre-Retirement Account (4)
 $10,721  $10,880   --   --  $10,079  $10,274  $8,649  $8,841   --   -- 
ESOP Contributions $10,024  $9,136  $0  $3,990  $10,024  $9,136  $8,842  $8,407  $6,511  $6,098 
Excess Life/COBRA Reimbursement(5)
  --   --  $3,659  $0   --   --   --   --   --   -- 
Housing/Relocation (6)
  --   --  $2,628  $2,628   --   --   --   --   --   -- 
Imputed Income from Split-Dollar Life Insurance $660  $662   --   --  $587  $615  $466  $477   --   -- 
Supplemental Life Insurance $2,932  $3,161   --   --  $659  $659  $772  $772   --   -- 
Supplemental Long-Term Disability Insurance $6,768  $6,768   --   --  $4,739  $4,739  $2,329  $2,329   --   -- 
Uniform Allowance $500  $500  $0  $500  $500  $500  $500  $500  $435  $500 
Total $80,216  $85,133  $14,140  $12,097  $61,900  $67,995  $36,414  $35,513  $10,172  $10,428 
___________________
(1)  The Company provides automobiles for Mr. Cloutier, Ms. Hail, Mr. Landry and Mr. Utz. Amounts reported are reflective of the personal-use levels of this perquisite.
(2)  Reflects annual cash fees for serving on the Board.  We provide further details on the fees paid to directors in the Director Compensation section of this proxy.
(3)  We provide reimbursement for the annual expense of membership(s) per the terms of each employee’s employment agreement.
(4)  Reflects the annual accrued benefit liability for the pre-retirement accounts under the plan.
(5)  Provided to Mr. Corrigan as a one-time payment under the terms of his employment agreement.
(6)  The relocation expenses provided to Mr. Corrigan were paid in 2006; however under the terms of his employment agreement, the amount paid is earned on an annual basis over a three-year period.  Therefore, amounts reported in this table and in the Supplementary Compensation Table are prorated over the three years in which they are earned.
___________________


-25-

GRANTS OF PLAN BASED AWARDS
The Grants of Plan Based Awards Table discloses the total number of non-equity incentive based plan awards actually granted in 2007.  There were no grants of equity incentive plan awards during 2007.  The Grants of Plan Based Awards Table should be read in conjunction with the Summary Compensation Table.  The Summary Compensation Table reflects the portion of stock option awards made in previous years recognized for financial statement reporting purposes during 2007.

      Estimated Future Payouts Under Non-Equity Incentive Plan Awards
Name
Grant Date
 
Non-Equity Incentive Plan Awards:
Number of Units or Other Rights(1)
  
Threshold
($)
  
Target(2)
($)
 
Maximum
($)
(a)(b)    (c)  (d) (e)
C.R. Cloutier12/31/2007  131,250  $0  $175,875  
J. Eustis Corrigan, Jr.12/31/2007  39,375  $0  $52,763  
Karen L. Hail12/31/2007  65,625  $0  $87,938  
Donald R. Landry12/31/2007  47,250  $0  $63,315  
A. Dwight Utz12/31/2007  28,926  $0  $38,761  

___________________

(1)
Amounts granted pursuant to the Company’s Incentive Compensation Plan as described in the Compensation Discussion & Analysis.  Grants determined and awarded in December 2007 for the 2008 calendar year.

(2)Target is based on the December 31, 2007 basic earnings per share of $1.34 times the number of non-equity incentive plan awards granted for 2008.
___________________


-26-

OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END
The Outstanding Equity Awards at Fiscal Year End Table reflects each Named Executive Officer’s unexercised option award holdings at December 31, 2007 on an individual award basis.  There were no stock awards outstanding as of December 31, 2007.


  Options Awards
Name 
Number of Securities Underlying Unexercised Options Exercisable
(#)
  
Number of Securities Underlying Unexercised Options Unexercisable
(#)
  
Equity Incentive Plan Awards Number of Securities Underlying Unexercised Unearned Options
(#)
  
Options Exercise Price
($)
 Option Expiration Date
Date Grant Fully Vests(1)
(a) (b)  (c)  (d)  (e) (f) 
C.R. Cloutier  24,193   0   0  $7.77 02/28/200802/28/2003
C.R. Cloutier  24,814   0   0  $6.55 05/31/201205/31/2007
J. Eustis Corrigan Jr.  3,938   15,750   0  $22.48 06/21/201606/21/2011
Karen L. Hail  11,911   0   0  $6.55 05/31/201205/31/2007
A. Dwight Utz  9,925   0   0  $5.59 07/1/201107/1/2006
A. Dwight Utz  1,588   397   0  $8.62 02/10/201302/10/2008
A. Dwight Utz  541   361   0  $19.68 02/27/201402/27/2009


___________________

(1)  All options listed above vest at a rate of 20% per year over a five year period from the date of grant.

___________________

-27-

OPTION EXERCISES AND STOCK VESTED
The Option Exercises and Stock Vested Table provides the stock options exercised by each of the Named Executive Officers during 2007.

  Option Awards  Stock Awards 
Name 
Number of Shares Acquired on Exercise
(#)
  Value Realized upon Exercise ($)  
Number of Shares Acquired on Vesting
(#)
  
Value Realized on Vesting
($)
 
(a) (b)  (c)  (d)  (e) 
C.R. Cloutier  23,343  $535,022(1)  0  $0 
J. Eustis Corrigan Jr.  0  $0   0  $0 
Karen L. Hail  11,167  $215,858(2)  0  $0 
Donald R. Landry  3,970  $67,808(3)  0  $0 
A. Dwight Utz  0  $0   0  $0 


___________________

(1)     Reflects the difference between $26.28, the closing price of the stock on 2/1/07, and $3.36, the exercise price of the options.

(2)     Reflects the difference between $27.10, the closing price of the stock on 2/23/06, and $7.77, the exercise price of the options.

(3)     Reflects the difference between $23.63, the closing price of the stock on 7/13/07, and $6.55, the exercise price of the options.

___________________

-28-

PENSION BENEFITS
The Company does not provide pension benefits to the Named Executive Officers.  The Company has entered into an Executive Indexed Salary Continuation Agreement with Mr. Cloutier, Ms. Hail and Mr. Landry.  The agreements provide benefits to the executive officers upon reaching normal retirement age and are categorized as a nonqualified deferred compensation benefit.  We discuss the details of this arrangement and present the amounts in the Nonqualified Deferred Compensation section below.
NONQUALIFIED DEFERRED COMPENSATION
The Company provides Mr. Cloutier, Ms. Hail, and Mr. Landry with an Executive Indexed Salary Continuation Agreement which establishes a Pre-Retirement Account.  Upon the executive officer reaching normal retirement age, he or she will receive payment of the Pre-Retirement Account made in annual installments over 10 years.  The Pre-Retirement Account has been established as a liability reserve account on our books for the benefit of the executive officer.  The account is increased or decreased each year by an amount equal to the Index (annual earnings/loss for the year determined by the aggregate annual after-tax income as if potential life insurance contracts were purchased on the effective date of the agreement) less the cost of funds expense for that year (sum of the amount of premiums set forth in the potential life insurance contracts purchased on the effective date of the agreement, plus the amount of any after-tax benefits paid to the executive officer plus the amount of all previous years after-tax costs of funds expense and multiplying the sum by the average after-tax cost of funds of the Company’s third quarter call report for the year as filed with the Federal Reserve).

If the executive officer voluntarily terminates or we terminate the executive officer (not for cause) prior to normal retirement age, the executive officer will be entitled to receive 20% times the number of full years he or she has served from the date of the agreement (to a maximum of 100%) times the balance in the Pre-Retirement Account (as described above).  The benefit is payable over 10 years in equal installments beginning on the date the executive officer reaches normal retirement age.

If the executive officer dies before having received the full balance of the Pre-Retirement Account, the unpaid balance will be paid in a lump sum to the executive officer’s designated beneficiary.

In the event of a change of control of the Company and the executive officer’s employment is terminated, the executive officer receives the benefits as promised under the agreement upon attaining normal retirement age as if he/she had been continuously employed by us through normal retirement age.  Please refer to the Potential Payments Upon Termination or Change of Control section of this document for details of payouts under various termination scenarios.  The nonqualified deferred compensation amounts deposited in the Pre-Retirement Accounts is included the table which follows.

In addition to the deferred compensation provided under the Executive Indexed Salary Continuation Agreement, we provide a Director’s Deferred Compensation Plan to all Company directors, including Named Executive Officers serving on our Board.  Mr. Cloutier and Ms. Hail are the only Named Executive Officers with a balance in this deferred compensation plan.  We provide details on this plan within the Compensation of Directors section of this proxy.

-29-
The Nonqualified Deferred Compensation Table reflects the activity during the 2007 calendar year for each of the Named Executive Officers eligible for the Company’s deferred compensation benefits.

Nonqualified Deferred Compensation
Name
Type of Nonqualified Compensation Plan(1), (2)
 Executive Contributions in Last Fiscal Year ($)  Registrant Contributions in Last Fiscal Year ($)  
Aggregate Earnings in Last Fiscal Year
($)
  
Aggregate Withdrawals/
Distributions ($)
  
Aggregate Balance at Last Fiscal Year
($)
 
(a)  (b)  (c)  (d)  (e)  (f) 
C.R. CloutierDDCP $0  $0  $-257,327  $0  $1,394,129 
C.R. CloutierEISCP $0  $10,880  $0  $0  $60,502 
Karen L. HailDDCP $0  $0  $-165,034  $0  $894,133 
Karen L. HailEISCP $0  $10,274  $0  $0  $48,972 
Donald R. LandryEISCP $0  $8,841  $0  $0  $41,395 

___________________

(1)  DDCP is the Director’s Deferred Compensation Plan.  Deferred Compensation Plan is invested in MidSouth common stock. On January 1, 2007 stock price was $29.22 per share. On December 31, 2007 stock price declined to $23.22 per share resulting in a loss of earnings and a decline in the aggregate balance in these deferred accounts during 2007.  Dividends paid on the common stock are credited to each account and are used to purchase additional shares of common stock.

(2)  EISCP is the Executive Indexed Salary Continuation Plan.  The amounts presented reflect contributions or subtractions from the balances held in the pre-retirement accounts associated with the plan.  There are no credited earnings applied to the balances held in these pre-retirement accounts.  We also present the amounts contributed to these plans in the supplemental table on All Other Compensation provided in the footnotes to the Summary Compensation Table.
___________________

-30-

POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE OF CONTROL
This section discusses the incremental compensation that would be payable by the Company to each Named Executive Officer in the event of his or her termination of employment under various scenarios (“termination events”) including voluntary resignation, involuntary termination, termination without cause or for Good Reason in connection with a change in control, termination in the event of disability, termination in the event of death, and termination in the event of retirement.  In accordance with applicable SEC rules, the following discussion assumes:

  (i)         that the termination event in question occurred on December 31, 2007; and

  (ii)      with respect to calculations based on our stock price, we used $23.22, which was the reported closing price of one share of the Company’s common stock on December 31, 2007, the last business day of 2007.

Pursuant to applicable SEC rules, the analysis contained in this section does not consider or include payments made to a Named Executive Officer with respect to contracts, agreements, plans or arrangements to the extent they do not discriminate in scope, terms or operation, in favor of executive officers of the Company and that are available generally to all salaried employees, such as the Company’s 401(k) Plan.  The actual amounts that would be paid upon a Named Executive Officer’s termination of employment can only be determined at the time of such executive officer’s termination.  Due to the number of factors that affect the nature and amount of any compensation or benefits provided upon the termination events, any actual amounts paid or distributed may be higher or lower than reported below.  Factors that could affect these amounts include the timing during the year of any such event and our stock price.

All outstanding stock options granted pursuant to the 1997 Stock Incentive Plan automatically become fully exercisable upon a change in control of the Company, as defined in the plan document.  Upon termination for cause, all executives forfeit any balances in pre-retirement accounts and any cash severance payments.  We present details for the other termination scenarios below.

C.R. Cloutier
Upon voluntary resignation, Mr. Cloutier receives the balance in his pre-retirement account paid out in equal annual installments over a ten-year period beginning at the age of 65.  The value presented in the table is the present value of this benefit.

Mr. Cloutier will receive a lump sum equal to one times base salary in the event of involuntary termination without cause.  In addition to the cash severance, Mr. Cloutier receives the balance in his pre-retirement account paid out in equal annual installments over a ten-year period beginning at the age of 65.  The value presented in the table is the present value of this benefit.

In the event of termination without cause or for good reason in connection with a change-in-control, Mr. Cloutier will receive one times base salary payable in equal installments over 12 months.  He will also receive the benefit specified under the terms of his Executive Indexed Salary Continuation Plan as if he had been continuously employed until his normal retirement age of 65.  The value presented in the table is the present value of this benefit.

-31-
Upon death, Mr. Cloutier’s beneficiaries will receive the benefit as defined under his supplemental life insurance policy and 80% of the death benefit of the whole life policy associated with the Executive Indexed Salary Continuation Plan.  In addition, his beneficiaries will receive a lump-sum payment of the unpaid accrued benefit balance in his pre-retirement account associated with the Executive Indexed Salary Continuation Plan.

Upon long-term disability, Mr. Cloutier will receive the benefit presented in the table as specified under his supplemental long-term disability policy.  Mr. Cloutier also receives the balance in his pre-retirement account paid out in equal annual installments over a ten-year period beginning at the age of 65.  The value presented in the table is the present value of this benefit.


Karen L. Hail
Upon voluntary resignation, Ms. Hail receives the balance in her pre-retirement account paid out in equal annual installments over a ten-year period beginning at the age of 65.  The value presented in the table is the present value of this benefit.

Ms. Hail will receive a lump sum equal to one times base salary in the event of involuntary termination.  In addition to the cash severance, Ms. Hail receives the balance in her pre-retirement account paid out in equal annual installments over a ten-year period beginning at the age of 65.

In the event of termination without cause or for good reason in connection with a change-in-control, Ms. Hail will receive on times base salary payable in equal installments over 12 months.  She will also receive the benefit specified under the terms of her Executive Indexed Salary Continuation Plan as if she had been continuously employed until her normal retirement age of 65.  The value presented in the table is the present value of this benefit.

Upon death, Ms. Hail’s beneficiaries will receive the benefit as defined under her supplemental life insurance policy and 80% of the death benefit of the whole life policy associated with the Executive Indexed Salary Continuation Plan.  In addition, her beneficiaries will receive a lump-sum payment of the unpaid accrued benefit balance in her pre-retirement account associated with the Executive Indexed Salary Continuation Plan.

Upon long-term disability, Ms. Hail will receive the benefit presented in the table as specified under her supplemental long-term disability policy.  Ms. Hail also receives the balance in her pre-retirement account paid out in equal annual installments over a ten-year period beginning at the age of 65.  The value presented in the table is the present value of this benefit.


J. Eustis Corrigan, Jr.
In the event of a termination without cause or for good reason, in connection with a change-in-control, Mr. Corrigan will receive two times the total of base salary payable and incentives earned in the prior year under the Company’s annual incentive plan.  The payments will be made in equal installments over 24 months.

-32-
In addition, per the terms of the Stock Incentive Plan, all unvested options will immediately vest and become exercisable in connection with a change-in-control.  Mr. Corrigan is not eligible for any other forms of compensation.


Donald R. Landry
We are not contractually obligated to provide Mr. Landry with a cash severance payment upon termination.

Upon voluntary resignation or involuntary termination without cause, Mr. Landry receives the balance in his pre-retirement account paid out in equal annual installments over a ten-year period beginning at the age of 65.  The value presented in the table is the present value of this benefit.

In the event of termination without cause or for good reason in connection with a change-in-control, Mr. Landry will receive the benefit specified under the terms of his Executive Indexed Salary Continuation Plan as if he had been continuously employed until his normal retirement age of 65.  The value presented in the table is the present value of this benefit.

Upon death, Mr. Landry’s beneficiaries will receive the benefit as defined under his supplemental life insurance policy and 80% of the death benefit of the whole life policy associated with the Executive Indexed Salary Continuation Plan.  In addition, his beneficiaries will receive a lump-sum payment of the unpaid accrued benefit balance in his pre-retirement account associated with the Executive Indexed Salary Continuation Plan.

Upon long-term disability, Mr. Landry will receive the benefit presented in the table as specified under his supplemental long-term disability policy.  Mr. Landry also receives the balance in his pre-retirement account paid out in equal annual installments over a ten-year period beginning at the age of 65.  The value presented in the table is the present value of this benefit.


A. Dwight Utz
We are not contractually obligated to provide Mr. Utz with a severance payment upon termination; however, he will receive benefits under the Company’s Stock Incentive Plan in the event of a change in control (no termination requirement applies).  Per the terms of the Stock Incentive Plan, all unvested options will immediately vest and become exercisable in connection with a change-in-control.  There is no termination requirement placed upon the acceleration of the vesting.


-33-

The table below indicates the amount of compensation payable to each Named Executive Officer, including cash severance, insurance benefits, indexed salary continuation benefits, and stock option awards, as applicable upon different termination events.  The amounts shown assume a termination date of December 31, 2007 and present total amounts for each scenario.

            Potential Payments Upon Termination or Change-in-Control
Compensation and/or Benefits Payable Upon Termination Early Retirement/ Voluntary Resignation  Involuntary Termination for Cause  Involuntary Termination without Cause  Termination in Connection with a Change in Control (without Cause or for Good Reason)  Termination in the Event of Disability  Termination in the Event of Death 
C.R. Cloutier                  
Cash Severance $0  $0  $200,000  $200,000  $0  $0 
Supplemental Life Insurance $0  $0  $0  $0  $0  $400,000 
Supplemental Long-Term Disability(1)
 $0  $0  $0  $0  $190,227  $0 
Executive Indexed Salary Continuation(1)
 $37,795  $0  $37,795  $66,821  $37,795  $60,502 
Split-Dollar Life Insurance $0  $0  $0  $0  $0  $505,628 
Intrinsic Value of Unvested Stock Options $0  $0  $0  $0  $0  $0 
TOTAL $37,795  $0  $237,795  $266,821  $228,022  $966,130 
                         
J. Eustis Corrigan Jr.                        
Cash Severance $0  $0  $0  $399,500  $0  $0 
Intrinsic Value of Unvested Stock Options $0  $0  $0  $11,655  $0  $0 
TOTAL $0  $0  $0  $411,155  $0  $0 
                         
Karen L. Hail                        
Cash Severance $0  $0  $157,000  $157,000  $0  $0 
Supplemental Life Insurance $0  $0  $0  $0  $0  $500,000 
Supplemental Long-Term Disability(1)
 $0  $0  $0  $0  $711,809  $0 
Executive Indexed Salary Continuation(1)
 $21,226  $0  $21,226  $76,570  $21,226  $48,972 
Split-Dollar Life Insurance $0  $0  $0  $0  $0  $675,922 
Intrinsic Value of Unvested Stock Options $0  $0  $0  $0  $0  $0 
TOTAL $21,226  $0  $178,226  $233,571  $733,035  $1,224,894 
                         
Donald R. Landry                        
Cash Severance $0  $0  $0  $0  $0  $0 
Supplemental Life Insurance $0  $0  $0  $0  $0  $500,000 
Supplemental Long-Term Disability(1)
 $0  $0  $0  $0  $761,054  $0 
Executive Indexed Salary Continuation(1)
 $15,607  $0  $15,607  $76,393  $15,607  $41,395 
Split-Dollar Life Insurance $0  $0  $0  $0  $0  $644,119 
Intrinsic Value of Unvested Stock Options $0  $0  $0  $0  $0  $0 
TOTAL $15,607  $0  $15,607  $76,393  $776,661  $1,185,514 
                         
A. Dwight Utz                        
Cash Severance $0  $0  $0  $0  $0  $0 
Intrinsic Value of Unvested Stock Options $0  $0  $0  $7,073  $0  $0 
TOTAL $0  $0  $0  $7,073  $0  $0 
___________________

1) Present value of benefit calculated based on a discount of 5.68%, which is 120% of the annually compounded long-term Applicable Federal Rate (AFR) as of 12/31/2007.
___________________
-34-
COMPENSATION OF DIRECTORS

A majority of our Directors are also Directors of MidSouth Bank, N.A.  Directors are entitled to fees of $750 per month for Board service and their associates$250 per month for MidSouth Bank Board service.  The Chairman receives an additional $900 per month, the Vice Chairman an additional $450 per month, and the Audit Committee Chairman an additional $800 per month. Each Director of the Board also receives $500 for each regular meeting and $500 for each special meeting of the Board of the Company, $200 for the first hour, and $100 per hour for each additional hour of each committee meeting of the Board.   Each Director also receives $500 for each regular meeting, $500 for each special meeting of the Board of MidSouth Bank, $200 for the first hour, and $100 per hour for each additional hour of each committee meeting.  Directors receive meeting fees only for meetings they attend.

In 1997, Directors who were not employees were given options to buy up to 20,736 shares of stock at $3.53 per share, the fair market value on the date of grant, all of which have been customersexercised.  Stephen C. May, a more recent addition to the Board, was granted options in 2002 to purchase up to 12,904 shares of andcommon stock at $6.55 per share, the fair market value on the date of grant, exercisable in annual 20% increments beginning in 2003.

Director’s Deferred Compensation Plan
We have borrowed from,a Deferred Compensation Plan for members of the BankBoard of Directors, administered by the Executive Committee of the Board of Directors.   To participate in the ordinary coursePlan, the Director executes a Deferral Authorization form in which the Director agrees to defer all or a specified percentage of business,his/her fees payable for the services as a member of the Board of Directors or a participating subsidiary. As of the last day of each calendar month, fees deferred are credited to the account and such transactions are expectedused to continuepurchase MidSouth Bank common stock.  Dividends paid on the common stock are credited to each account and are used to purchase additional shares of common stock.  Amounts in each Director’s account are distributed in a single lump sum either (i) 60 days after the later of the Director ceasing to be a member of the Board of Directors, or the Director attaining age 65 or (ii) in the future. Insole discretion of the opinionBoard of MidSouth’s management,Directors not earlier than one year after (i) reasonable conditions as established by the Company’s loan policy willBoard are satisfied, the Director ceases to be less favorablea member of the Board of Directors, and the Director requests payment.

The following Director Compensation Table displays the total compensation awarded to, earned by or paid to Directors thanfor the fiscal year ending December 31, 2007.  Directors who are also Named Executive Officers are not included in the table below.  Compensation paid to other customers.

- 13 -

Named Executive Officers serving as Directors is presented in the supplementary table which details the “All Other Compensation” amounts included in the Summary Compensation Table.  All amounts shown below are in dollars.



-35-

   Directors Compensation
Name 
Fees Earned or Paid in Cash
($)
  
Stock Awards
($)
  
Option Awards(1)
 
($)
  
Non-Equity Incentive Plan Compensation
($)
  
Change in Pension Value and Nonqualified Deferred Compensation Earnings
($)
  
All Other Compensation (2)
 
($)
  
Total
($)
 
(a) (b)  (c)  (d)  (e)  (f)  (g)  (h) 
Will Charbonnet, Sr. $52,050  $0  $0  $0  $0  $0  $52,050 
James R. Davis, Jr. $35,850  $0  $0  $0  $0  $0  $35,850 
J.B. Hargroder, M.D. (3)
 $50,800  $0  $0  $0  $0  $0  $50,800 
Clayton Paul Hilliard $26,450  $0  $0  $0  $0  $0  $26,450 
Milton B. Kidd, III, O.D. $25,850  $0  $0  $0  $0  $0  $25,850 
Timothy J. Lemoine $29,550  $0  $0  $0  $0  $0  $29,550 
Stephen C. May $24,650  $0  $2,146  $0  $0  $0  $26,796 
R. Glenn Pumpelly $29,250  $0  $0  $0  $0  $0  $29,250 
William M. Simmons (3)
 $41,750  $0  $0  $0  $0  $0  $41,750 
Joseph V. Tortorice, Jr. (3)
 $22,150  $0  $0  $0  $0  $0  $22,150 

___________________

(1)Reflects compensation expense recognized for financial statement reporting purposes for 2007 computed in accordance with Statement of Financial Accounting Standards No. 123 (revised 2004) Share Based Payment (“FAS 123R”), disregarding the estimate of forfeitures related to service-based vesting conditions, with respect to awards granted in 2002.

Assumptions used in the calculation of this amount are included in footnote 1 to our audited financial statements for 2004 included in our Annual Report on Form 10-K filed with the SEC.

(2)Certain Directors receive perquisites such as travel reimbursement; however, the aggregate amount of such compensation is less than $10,000 and therefore is not reported.

(3)Includes Director fees paid by MidSouth Bank - -Texas.

___________________



-36-

Shareholder Return Performance Graph


The following graph, which was prepared by SNL Securities LC (“SNL”), compares the cumulative total return on MidSouth’s Commonour Stock over a measurement period beginning December 31, 19992002 with (i) the cumulative total return on the stocks included in the Russell 3000 and (ii) the cumulative total return on the stocks included in the SNL $250M-$500M and the SNL $500M-$1B Bank Index.  All of these cumulative returns are computed assuming the quarterly reinvestment of dividends paid during the applicable period.

(PERFORMANCE GRAPH)

                         
Index 12/31/99  12/31/00  12/31/01  12/31/02  12/31/03  12/31/04 
 
MidSouth Bancorp, Inc.  100.00   98.14   134.49   204.06   413.74   447.50 
Russell 3000  100.00   92.54   81.94   64.29   84.25   94.32 
SNL $250M-$500M Bank Index  100.00   96.28   136.80   176.39   254.86   289.27 
SNL $500M-$1B Bank Index  100.00   95.72   124.18   158.54   228.61   259.07 

The Common

MidSouth Bancorp, Inc.
Return Performance Chart

   
Period Ending
 
Index 12/31/02  12/31/03  12/31/04  12/31/05  12/31/06 
MidSouth Bancorp, Inc.  100.00   202.76   219.30   243.85   355.19 
Russell 3000  100.00   131.06   146.71   155.69   180.16 
SNL Bank $250M-$500M Index  100.00   144.49   163.99   174.11   181.92 
SNL Bank $500M-$1B Index  100.00   144.19   163.41   170.41   193.81 
Our Stock of the Company is traded on the American Stock ExchangeAMEX under the “MSL” ticker symbol.  The stock price information shown above is not necessarily indicative of future price performance.  Information used was obtained by SNL from sources believed to be reliable.  The Company isWe are not responsible for any errors or omissions in such information.

- 14 -


COMPENSATION COMMITTEE REPORT

     The Personnel Committee is made up of seven non-employee directors of MidSouth Bancorp, all of whom are independent, as defined in the listing standards of the American Stock Exchange. The committee met four times during 2004 to discuss such matters as executive compensation and performance.

     The Committee committed to ensuring the company’s total compensation package for the Chief Executive Officer and other named executive officers will serve to:

Attract, retain and motivate outstanding executive management who add value to the organization based on individual and team contributions;

Provide a highly competitive salary structure in all markets where we operate;

Facilitate employee ownership through equity components of performance-based long-term incentive stock plans that also enhance shareholder value.

     In recent years, due to industry consolidation, the Peer Bank Group used for comparative purposes continues to shrink. Recognizing this, the Committee engaged a national compensation consulting firm, KG & Associates, for compensation comparisons and information provided by Sheshunoff Management Services, L.P. for compensation comparisons and measure of the company’s performance.

Base Compensation: To ensure the competitiveness of the company’s total compensation package, the committee reviews salary survey information developed by the Bank’s Human Resources Department regarding the compensation practices of a peer bank group using information from a national compensation consulting firm. In addition, the committee reviews financial industry salary survey information developed by Sheshunoff Management Services, L.P. The goal is to set executive base compensation plus quarterly incentive pay between the top of the second quartile and the lower part of the 1st quartile for the peer group. It is the Company’s goal to set the base compensation part of total compensation to comfortably meet the executive’s needs and to put more emphasis on incentive pay so that the executives are encouraged to grow the Bank’s value short term and long term. This way, the executive is well compensated in relation to the Bank’s performance.

Incentive Compensation: The Company uses a system of incentive compensation to reward the executives quarterly based on the earning per share of the Company. The total incentive compensation is based on the performance for the whole year; a reduced portion is paid quarterly with the balance paid at the end of the year. The Company believes this method encourages the executives to think in terms of shareholder earnings per share because a substantial portion of their pay is tied to earnings per share. At the Personnel Committee Meeting of December 15, 2004 executive pay was set for 2005 with the CEO’s base salary remaining the same and all of his increased pay being tied to additional incentive compensation. The Senior Executive Vice President and the Executive Vice President received part of their increase for 2005 in base salary and part in incentive compensation.

- 15 -

In 2005, the President and Chief Executive Officer’s base pay is set at $196,000. The CEO’s projected incentive compensation based on 2004 earnings per share of $1.73 would result in incentive compensation of $138,800 which is 71% of base pay. Actual incentive compensation will vary based on the earning per share for 2005.

For 2005, it was the Personnel Committee’s intent to raise total base pay and incentive compensation approximately 15% for the three executive officers. This is a much larger increase than in previous years but it was based on the tremendous growth over the last several years of the Company and the acquisition of Lamar Bank, giving the Company additional growth opportunities in Texas. With the added responsibility and the comparison to peer groups it was felt that this was appropriate at this time.

Long Term Incentives: It is the Company’s belief that executive officers need to have a significant interest tied to long term performance and shareholder increased value. The Company believes the best way to accomplish this is through ownership of Company. The Company encourages is executive officers to own stock and provides the following programs to encourage stock ownership.

Directors Deferred Compensation Plan: In 1990, the Company established a Deferred Compensation Plan to encourage all directors to take part of their director pay in shares of stock of the Company.

ESOP: To encourage ownership of the company by executive officers and all employees and therefore tie their interest to the interest of the shareholders, the Company established an ESOP Plan in 1986.

Stock Options: In addition to the above, the Company has periodically granted stock options to executive officers and senior management. These options are always based on the current stock price at the time they are awarded. The executives can only benefit by increasing the long term value of the stock.

Personnel Committee of the Board of Directors

Will G. Charbonnet Sr.
James R. Davis, Jr.
J. B. Hargroder, MD
Clayton Paul Hilliard
Milton B. Kidd, III, OD
Stephen C. May
William M. Simmons

- 16 -

-37-



AUDIT COMMITTEE REPORT

     The


Our Audit Committee of our Board of Directors is composed of four non-employee directors.  The Board has made a determination that theits members of the Committee satisfy theAMEX’s requirements of the American Stock Exchange as to independence, financial literacy and experience. The Board has also determined that it is not clear whether any member of the Audit Committee is a “Financial Expert” within the meaning of SEC Rules, but the Board does not feel a Financial Expert to be necessary in view of the overall financial sophistication of Committee members. The responsibilities of the Committee are set forth in the Charter of theour Audit Committee which was adopted by the Board of Directors on May 10, 2000 and revised on March 12, 2003. The revised Charter was reviewed again and approved without changes at the March 16, 2005 Board Meeting. A copy of the Charter is attached as Exhibit B.

Charter.


The Committee reviewed and discussed the audited financial statements with management including a discussion of the quality of the accounting principles, the reasonableness of significant judgments and the clarity of disclosures contained in the financial statements.  The Committee also discussed with the independent auditors the matters required to be discussed by SAS 61 (Codification of Statements on Auditing Standards, AU Section 380).  The Committee also received the written disclosures and the letter from the independent auditors required by Independent Standards Board Standard No. 1 (Independent Standards Board Standard No. 1, Independence Discussions with Audit Committees), has discussed with the independent auditors the independent auditors’ independence and has considered the compatibility of non-audit services with the auditors’ independence.


The Committee discussed with the Company’sour internal and independent auditors the overall scope and plans for their respective audits.  The Committee met with the internal and independent auditors, with and without management present, to discuss the results of their examinations, their evaluations of the Company’sour internal controls, and the overall quality of the Company’sour financial reporting.


Based on the reviews and discussions referred to above, the Committee recommended to the Board that the audited financial statements be included in our Annual Report on Form 10-K for the year ended December 31, 20042007 for filing with the SEC.


By the members of the Audit Committee:
James R. Davis, Jr.
Will G. Charbonnet, Sr.
Clayton Paul Hilliard
Milton B. Kidd, III, O.D.

- 17 -



-38-

RELATIONSHIP WITH INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS

General

     MidSouth’s consolidated financial statements for 2003 and 2004 were audited by the firm


Principal Accountant

The Audit Committee of Deloitte & Touche LLP (“Deloitte”). Deloitte will remain MidSouth’s external auditors until replaced by the Board of Directors uponhas appointed the recommendationfirm of Porter, Keadle Moore, LLP independent certified public accountants, to serve as our principal auditors and to perform the audit of the Audit Committee. financial statements for the fiscal year ending December 31, 2008.

Representatives of Deloitte are not expected toPorter, Keadle Moore, LLP will be present at the annual shareholders’ meeting.

meeting, will have an opportunity to make a statement if they so desire, and will be available to respond to appropriate shareholder questions.


Fees

     The following table summarizes and Services


During the fees billed to MidSouth for professional services rendered in 2003 and 2004. All of the services performed were approved by the Audit Committee prior to the service being rendered.
                 
  Year-ended December 31, 
  2004      2003     
Fee Category Amount  %  Amount  % 
Audit fees $89,600   100% $57,400   90%
Audit-related fees  0   0   6,600   100%
   
                 
Total fees $89,600   100% $64,000   100%
   

     Audit fees include fees associated with the required annual audit and report on Form 10K, reviews of MidSouth’s quarterly reports on Form 10Q and services that are normally performed by the external independent auditor in connection with regulatory filings forperiod covering the fiscal years ended December 31, 20042007 and 2003. 2006, Porter Keadle Moore, LLP performed the following professional services:


Description 2007  2006 
Audit Fees $254,778   257,092 
         
Audit-Related Fees $-   - 
         
Tax Fees $-   - 
         
All Other Fees $-   - 
Audit Fees. This category includes aggregate fees billed for 2004 included fees for a consent in connection with a Form S-4 regarding MidSouth’s acquisition of Lamar Bancshares, Inc. Audit-related feesprofessional services rendered by Porter Keadle Moore, LLP for the yearaudit of the Company’s annual consolidated financial statements for the years ended December 31, 20032007 and 2006, including the audit of internal control over financial reporting; review of the annual report on Form 10-K and review of quarterly condensed consolidated financial statements included employee benefit plan audit fees. Deloitte does not perform tax services for MidSouth.

in periodic reports filed with the SEC, including out of pocket expenses.


Pre-Approval Policy


The Audit Committee’s policy is to pre-approve all audit and permissible non-audit services provided by the independent auditors.  These services may include audit services, audit-related services, tax services and other services.  Pre-approval is generally provided for up to one year and any pre-approval is detailed as to the particular service or category of services and is generally subject to a specific budget.  The independent auditors and management are required to periodically report to the Audit Committee regarding the extent of services provided by the independent auditors in accordance with this pre-approval, and the fees for services performed to date.  The Audit Committee may also pre-approve particular services on a case-by-case basis. For 2003, pre-approved non-audit services included only those services described above for “Audit Related Fees.” No audit-related services were performed by the independent auditors in 2004.

- 18 -


-39-


ANY SHAREHOLDER MAY BY WRITTEN REQUEST OBTAIN WITHOUT CHARGE A COPY OF MIDSOUTH’SOUR ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 2004,2007, WITHOUT EXHIBITS.  REQUESTS SHOULD BE ADDRESSED TO SALLY D. GARY, INVESTOR RELATIONS, MIDSOUTH BANCORP, INC., P. O. BOX 3745, LAFAYETTE, LOUISIANA 70502.

By Order of the Board of Directors

Karen L. Hail
    0;Secretary

                         &# 160;         Lafayette, Louisiana
                                           & #160;        April 25, 2005

- 19 -

EXHIBIT A
MidSouth Bancorp, Inc.
Corporate Governance Principles

I.Board of Directors

A.  Membership

1.  Size of Board.

      The Board’s optimum size is approximately 9-12 members. However, the Board would be willing to have a greater number of directors to accommodate the availability of an outstanding candidate. Similarly, the Board is willing to reduce the size of the Board, or maintain a vacancy, if it cannot identify available candidates meeting the Board’s qualification standards.

2.  Mix of Inside and Outside Directors.

      The Board should have a significant majority of outside directors; the expectation of the Board is the number of inside directors should not exceed three.

3.  Director Qualifications.

      The Board seeks members from diverse professional backgrounds who combine a broad spectrum of experience and expertise with a reputation for integrity. Directors should have experience in positions with a high degree of responsibility, be leaders in the companies or institutions with which they are affiliated and be selected based upon contributions they can make to the Board and management.

4.  Definition of “Independent” and “Outside” Directors.

      The Board’s policy is that a majority of the members of the Board meet the criteria for independent directors in accordance with the applicable rules of the American Stock Exchange. The determination that a Director is independent shall be made by the Board following a review of all relevant information and a recommendation by the Corporate Governance and Nominating Committee. Any independent director is also considered to be an Outside Director.

5.  Selection of New Directors.

      The Corporate Governance and Nominating Committee has, as one of its responsibilities, the recommendation of director candidates to the full Board after receiving input from all Directors and the Chief Executive Officer.

6.  Other Directorships.

      Directors are expected to advise the Chairman of the Board promptly upon being offered any other public company directorship. Unless the Board determines that the carrying out of a Director’s responsibilities to the Company will not be adversely affected by the Director’s other directorships, Directors should not serve on any public company boards other than the Company.

- 20 -

B.  Responsibilities

1.  Basic Duties

      The basic responsibility of the Directors is to exercise their business judgment in good faith to act in what they believe to be in the best interests of the Company. Directors are expected to regularly attend 100% of the Board meetings and at least 92% of the meetings of committees on which they serve, and to spend the time needed and meet as frequently as necessary to properly discharge their responsibilities. To prepare for meetings, Directors are expected to review the materials that are sent to Directors in advance of those meetings.

2.  Conflicts of Interest.

a) Directors are expected to avoid any action, position or interest that conflicts with an interest of the Company, or gives the appearance of a conflict. The Company annually solicits information from Directors in order to monitor potential conflicts of interest and Directors are expected to be mindful of their fiduciary obligations to the Company. When faced with a situation involving a potential conflict of interest, Directors are encouraged to seek advice from the Chief Legal Officer. Directors shall recuse themselves and not participate in the discussion and voting on any matter presented at a Board meeting if they believe that they have a personal interest or a conflict of interest. If a significant conflict of interest with a Director exists and cannot be resolved, the Director is expected to tender his or her resignation to the Chairman.

b) The Company’s loan policy will be less favorable to Directors than to other customers.

3.  Consulting Agreements with Directors.

      The Board believes that the Company should not enter into paid consulting arrangements with Outside Directors.

4.  Share Ownership by Directors.

      The Board believes that the number of shares of the Company’s common stock owned by each Director is a personal decision; however, each director serving on the date of the adoption of these Principles is expected to own a minimum of 25,000 shares of stock at all times, and new Directors are expected to own a minimum of 10,000 shares of stock within a reasonable time after their election or appointment.

5.  Director Compensation.

      The Personnel Committee shall recommend Director compensation and benefits to the full Board based on comparable information for companies of similar size and recommendations from management. The Committee when making its recommendations may take into account the appearance that Directors’ independence is adversely affected if Director compensation and benefits exceed customary levels, if the Company makes substantial charitable contributions to organizations with

- 21 -

which a Director is affiliated, or if the Company enters into consulting contracts with, or provides other indirect forms of compensation, to a Director or an organization with which the Director is affiliated.

6.  Assessing Board Performance.

      The Corporate Governance and Nominating Committee has the responsibility to periodically assess overall and individual Board performance. A self-evaluation shall be conducted annually to determine whether the Board and its committees are functioning effectively. The Board will discuss the results of the self-evaluations to determine what actions could improve Board and Committee performance.

7.  Lead Director.

      A Lead Director for purposes of oversight of Audit, Loan Review and Compliance Departments has been appointed by the Board and is an Outside Director.

8.  Executive Sessions of Outside Directors.

      Executive Sessions are those sessions including the Chairman and Outside Directors and should be called by the Chairman. Meetings that include only nonemployee Directors — called Outside Directors Sessions — should occur at least three times a year on the periodic evaluation of the Chief Executive Officer, to determine Director independence and to discuss other matters of importance.

9.  Board Access to Management and Independent Advisors.

      Board members have complete and open access to members of management. The Chief Executive Officer shall invite key employees to attend Board and Committee meetings at which the Chief Executive Officer believes they can meaningfully contribute to Board and Committee discussion. The Board and Board committees may consult with and retain independent legal, financial and other advisors as they may deem necessary.

10.  Board Interaction with Institutional Investors, Peers, Customers, etc.

      The Board believes that under ordinary circumstances, management speaks for the Company and the Chairman speaks for the Board. Individual Board members may, from time to time, meet with or communicate with various constituencies that are involved with the Company. It is expected that Board members would do this with the knowledge of management and, in most instances, at the request of management.

11.  Confidentiality of Information.

      In order to facilitate open discussion, the Board believes maintaining confidentiality of information and deliberations is an imperative.

12.  Director Orientation and Continuing Education.

      New Board Directors shall participate in an orientation program to familiarize themselves with the Company’s businesses and operations, and their responsibilities

- 22 -

and duties as Directors. Continuing education for Directors shall be conducted through a number of methods, including presentations by the Company’s officers concerning the Company’s strategies, initiatives and business plans; presentations by outside parties concerning industry issues and general business and regulatory matters; on-site meetings with Company personnel at their business locations; and other appropriate programs to carry out continuing education.

13.  Regulatory Reports.

      The Board shall review all reports from the Office of the Comptroller of the Currency and the Federal Reserve Board and consider all recommendations therein.

14.  Code of Ethics.

      The Board shall adopt a Code of Ethics for itself, management and employees.

II.Board Committees

1.  Committee Structure.

      The Board shall at all times maintain committees with the following responsibilities: an audit committee, a compensation committee, and a governance and nominating committee. All of the members of these committees shall be independent directors under the criteria established by the American Stock Exchange, and each of these committees shall operate in accordance with the applicable rules of the Securities and Exchange Commission and the American Stock Exchange. The Board has established the following Committees; Audit, Corporate Governance and Nominating; Personnel and Executive. The Board shall establish such additional committees as it deems appropriate.

2.  Committee Charters.

      The Committees will establish their own charter setting forth the purposes and responsibilities of the Committee. The charters shall also provide that each Committee will annually evaluate its performance.

3.  Frequency and Length of Board Committee Meetings.

      The Chairman should regularly consult with Committee Chairs to obtain their insights and to optimize Committee performance. The Committee Chairs, in consultation with the Chairman, the Chief Financial Officer and the Chief Legal Officer, should establish the frequency and length of Committee meetings.

4.  Development of Committee Agenda.

      The Committee Chairs, working with the Chief Executive Officer, should establish Committee agendas for the year. All standing Committees should meet regularly during the year and receive reports from Company personnel on Company

- 23, -

2008

developments affecting the Committee’s work. At the beginning of each year, the Audit Committee should review and approve the internal audit staff’s schedule for the year.

III.Chairman & Chief Executive Officer

1.  Separate Positions of Chairman, President and Chief Executive Officer.

      The positions of Chairman and Chief Executive Officer may not be the same person. The Chairman should be an outside Director.

2.  Formal Evaluations of the Chief Executive Officer.

      The Personnel Committee shall annually conduct the Chief Executive Officer evaluation in the context of its review of the Company’s performance in meeting its goals for purposes of awarding compensation. The Personnel Committee Chair shall report to the Board on the evaluation in a Board meeting attended by Outside Directors.

3.  Succession Planning.

      The Chief Executive Officer shall review succession planning on an annual basis with the Board, including succession plans for the Chief Executive Officer.

4.  Management Development.

      Senior Company executives should compile and evaluate a succession plan for their areas of responsibility which should be reviewed with the Chief Executive Officer and the Board. The Chief Executive Officer shall provide input on each succession plan and discuss the plans with the Board in an Executive Session.

- 24 -

EXHIBIT B

MidSouth Bancorp, Inc. Audit Committee Charter

The Board of Directors (Board) of MidSouth Bancorp, Inc. (MidSouth) has established its audit committee to assist it in monitoring 1) the integrity of MidSouth’s financial statements, (2) MidSouth’s compliance with legal and regulatory requirements and (3) the independence and performance of MidSouth’s internal and external auditors. In addition, the Committee is responsible to produce an annual report of its activities by inclusion in MidSouth’s proxy statement.

By approving this Charter, the Board obligates itself to provide appropriate funding, as determined by the Audit Committee, in its capacity as a committee of the Board, for payment of compensation to any public accounting firm engaged for the purpose of rendering or issuing an audit report or related work or performing other audit, review or attest services for the Bank or other related entities; and to any advisors employed by the Audit Committee.

The requisite number of members of the Audit Committee shall be appointed by the Board of Directors. Each member so appointed must meet the independence and experience requirements of the American Stock Exchange and of applicable sections of the Securities Exchange Act of 1934. The Chairman shall be designated by the Board.

The Audit Committee shall be directly responsible for the appointment, compensation, retention and oversight of the work of the independent auditor. In its capacity, the Audit Committee shall be responsible for resolving any disputes between the auditor’s work and management. The Audit Committee has the authority to engage special legal, accounting or other consultants to advise the Committee. The Audit Committee may request any officer or employee of the Company or the Company’s outside counsel or independent auditor to attend a meeting of the Committee or to meet with any member of, or consultants to, the Committee.

The Audit Committee shall make regular reports to the Board.

In its capacity the Audit Committee shall also:

1.  Review and reassess the adequacy of this Charter annually and recommend any proposed changes to the Board for approval.
2.  Review credentials of and recommend to the Board, the appointment of an independent auditor, which firm is ultimately accountable to the Audit Committee.
3.  Meet with the independent auditor prior to the audit to review the planning and staffing of the audit.
4.  Discuss with the independent auditor the matters required to be discussed by Statement on Auditing Standards No. 61 relating to the conduct of the audit and statement on Auditing Standard No. 10 relating to the conduct of a review of interim financial

- 25 -

information.
5.  Obtain from the independent auditor reports required by Section 10A of the Securities Exchange Act of 1934.
6.  Approve the fees to be paid to the independent auditor.
7.  Receive periodic reports from the independent auditor regarding the auditor’s independence consistent with Independence Standards Board Standard 1, discuss such reports with the auditor, and if so determined by the Audit Committee, take or recommend that the full Board take appropriate action to oversee the independence of the auditor.
8.  Review the annual audited financial statements with management, including major issues regarding accounting and auditing principles and practices as well as the adequacy of internal controls that could significantly affect the Company’s financial statements.
9.  Review any analysis prepared by management and the independent auditor of significant financial reporting issues and judgments made in connection with the preparation of the Company’s financial statements.
10.  Review with management and the independent auditor the Company’s quarterly financial statements prior to the filing of its Form10-Q and its annual financial statements prior to the filing of its Form 10K.
11.  Review major changes to the Company’s auditing and accounting principles and practices as suggested by the independent auditor, internal auditors or management.
12.  Meet periodically with management to review the Bank’s exposure to major financial risks and the steps management has taken to monitor and control such exposures.
13.  Approve the appointment and replacement of the senior internal auditing executive.
14.  Review the significant reports to management prepared by the internal auditing department and management’s responses.
15.  Resolve any problems or difficulties which may have been encountered between the internal auditor and management. Such review should include:

(a)  Any difficulties encountered in the course of the audit work, including any restrictions on the scope of activities or access to required information.
(b)  Any changes required in the planned scope of the internal audit.
(c)  The internal audit department responsibilities, budget and staffing.
(d)  Any difficulties which may have arisen between internal auditor and management concerning a response or lack thereof on any management letter.

16.  Approve the engagement of its independent auditor for any non-audit reviews, including its fees therefore.

- 26 -

17.  Review with the Company’s Counsel legal matters that may have a material impact on the financial statements, the Company’s compliance policies and material reports or inquiries received from regulators or governmental agencies.
18.  Meet at least annually with the chief financial officer, the senior internal auditing executive and the independent auditor in separate executive sessions.
19.  Establish procedures which provide for the receipt, retention and treatment of complaints regarding accounting, internal accounting controls or auditing matters, including procedures for the confidential, anonymous submission by employees of the Bank of concerns regarding questionable accounting or auditing matters.

While the Audit Committee has the responsibilities and powers set forth in this Charter, it is not the duty of the Audit Committee to plan or conduct audits or to determine that the Company’s financial statements are complete and accurate and are in accordance with generally accepted accounting principles. This is the responsibility of management and the independent auditor.

- 27 -

1.Election of Class III Directors
Nominees:James R. Davis, Jr.
Karen L. Hail
Milton B. Kidd, III, O.D.
___FOR all nominees listed except as marked to the contrary
___WITHHOLD authority for all nominees
If you wish to withhold authority to vote for certain of the nominees listed, strike through the nominee(s) names.
2.In their discretion, to vote upon such other business as may properly come before the meeting or any adjournment thereof.
This proxy will be voted as specified.If no specific directions are given, this proxy will be voted FOR the nominees named.
Please sign exactly as name appears on the certificate or certificates representing shares to be voted by the proxy. When signing as executor, administrator, attorney, trustee or guardian, please give full title as such. If a corporation, please sign in full corporate name by president or other authorized persons. If a partnership, please sign in partnership name by authorized persons.
Dated:________________________________________________2005
____________________________________________________________
                                      Signature of Shareholder
____________________________________________________________
                                      Signature (if jointly owned)
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD TO THE COMPANY PROMPTLY USING THE ENCLOSED ENVELOPE.

PROXY

MIDSOUTH BANCORP, INC.

-40-

May 26, 2005
Annual Meeting of Shareholders

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.

The undersigned hereby appoints Carlo Busceme, Jr., William R. Miller, John A. Raney, Jr., or any of them, proxies of the undersigned, with full power of substitution, to represent the undersigned and to vote all of the shares of Common Stock of MidSouth Bancorp, Inc. (the “Company”) that the undersigned is entitled to vote at the annual meeting of the shareholders of the Company to be held on May 26, 2005 and at any and all adjournments thereof.

- 2 -